Preamble

The House met at half-past Nine o'clock

PRAYERS

[MR. SPEAKER in the Chair]

Top Salaries Review Body

Mr. Roy Hattersley: On a point of order, Mr. Speaker. I wish to ask for your advice, and for your protection of the House. You will recall that yesterday afternoon, after Prime Minister's Question Time, the Government announced their attitude towards top pay in the Civil Service, the armed forces and the judiciary, and did so suddenly and three days earlier than the press had been allowed to believe.
The Opposition have pressed the Government to make a statement on this matter, not least because it has implications that go far wider than the 2,000 men and women involved. Questions on this subject need to be answered, in the national interest. I give one example. We need to know what the Government believe will be the effect of a 30 per cent. increase in the salary of the permanent secretary at the Department of Education and Science on the prospect of the teachers accepting a pay increase of 6 per cent. or a little more. Such questions are vital for the nation.
The Government have refused point blank to make such a statement and I ask you, Mr. Speaker, what recourse Opposition parties, and Parliament in general, have, and how we can ask the Government to do what is clearly necessary.

Mr. Eric Forth (Mid-Worcestershire): Further to that point of order, Mr. Speaker. It was an answer to my question that gave the Government's reaction. I need time to reflect on the wealth of detail in the answer given by the Prime Minister yesterday. I hope that the Government will not rush into an early statement and force me and the rest of the House to give an ill-considered reaction to this most important point. I urge the Government to give me time to think about it.

Mr. Dennis Skinner: Further to that point of order, Mr. Speaker. Do you recall that a fortnight and a day ago, at business questions, I asked about a statement on top salaries? We have just had a statement about teachers' pay from the Secretary of State for Education and Science. I suggested that it would be a good idea if, on the next occasion that we had a statement about the paltry offer being made to the teachers, it could be followed by a statement on the Government's attitude towards top pay, including the £24,000 that is being given to Sir Robert Armstrong, the Secretary to the Cabinet. He is one of the advisers to the Government on how to tell people to keep their wages down.
When I put that question to the Leader of the House, I got the clear impression that the Government would take the point on board. Yesterday the Government deliberately

got a question planted to prevent the matter from being debated openly in the House. While Tory Members of Parliament were upstairs in Committee Room 14 trying to cheer the Prime Minister on all her so-called wonderful efforts in the past 12 months, she should have been down here in the House, at the Dispatch Box, explaining why pensioners are stuck with a 7 per cent. increase, nurses will get only 7 per cent. with some clawback, teachers are offered only 5·8 per cent., and local authority manual workers are given only 4 per cent., whereas the top brass can get up to nearly 50 per cent. increases in pay.
It is a scandal, and the Government do not have the guts to come to the House and face the music, and explain how they have managed to pay such extortionate increases to people who are doing very nicely, thank you.

Mr. Patrick Thompson: Further to that point of order, Mr. Speaker. I hope that it is recognised that there is concern about this matter on both sides of the House and that therefore an early statement and debate would be welcomed by many people. both inside and outside the House.

Mr. Dave Nellist: Further to the point of order, Mr. Speaker. On Wednesday, the Secretary of State for Employment made a statement about the abolition of wages councils which have protected the wage rates of workers under the age of 21. That statement was the same length as the written answer by the Prime Minister on top salaries. The statement on Wednesday allowed Tory Members to argue that the wages of young people such as hairdressers earning £34 or £35 a week should be reduced to create employment. Yesterday Opposition Members were denied the opportunity to argue that 2,000 people—judges, top civil servants and leaders of the Armed Forces—already earning £40,000 or £50,000 a year should not be given another £10,000 or £20,000. The Government are two-faced and operating double standards.

Mr. Roger Gale: Further to the point of order, Mr. Speaker. Hon. Members on both sides of the House would like to make observations about yesterday's announcement. In spite of the purple prose of the hon. Member for Bolsover (Mr. Skinner), the paucity of attendance on the Opposition Benches suggests that next week might be a better time to discuss the matter. I urge you, Mr. Speaker, to use your good offices to ensure that the House has such an opportunity next week.

Mr. Clement Freud: Further to the point of order, Mr. Speaker. Before the House becomes any hotter on this matter, will the Leader of the House say whether a statement is to be made today?

Mr. Speaker: The House knows that notification of a statement does not have to be given to me before 10 o'clock, but I can tell the House that I have had notification that a business statement is to be made at 11 o'clock. Of course, I have no idea what it contains.

BUSINESS OF THE HOUSE

Ordered,
That, at this day's sitting,—
(1) the provisions of paragraph (1)(b) of Standing Order No. 3 (Exempted business) shall not apply to the two Motions in the name of Mr. Secretary Hurd relating to Northern Ireland; and


(2) Mr. Speaker shall put the Question on the first Motion not later than half-past Eleven o'clock and on the second Motion not later than half-past Two o'clock.—[Mr. Biffen.]

Betting and Gaming (Northern Ireland)

The Parliamenatry Under-Secretary for Northern Ireland (Mr. Christopher Patten): I beg to move.
That the draft Betting, Gaming. Lotteries and Amusements (Northern Ireland) Order 1985, which was laid before this House on 26th June, be approved.
The purpose of the order is to bring up to date the social law in Northern Ireland on all forms of betting, gaming, lotteries and amusements with prizes. The present law is outdated, is proving increasingly difficult to enforce and has fallen into disrepute in many respects. The order seeks to remedy that highly unsatisfactory situation by replacing all existing enactments with legislation which will reflect current attitudes to gambling and demands for gambling facilities and which can be expected, therefore, to command general public respect and to be capable of proper enforcement.
The legislation is lengthy and complex, and I shall not go into it in impenetrable detail. Instead I shall concentrate on the main provisions. Hon. Members may raise issues of detail with which I shall attempt to deal later if I have the opportunity.
Part II of the order largely re-enacts the existing betting law, but makes several changes aimed at making it more efficient in its operation. The major change of substance is to allow greyhound tracks to operate a tote. Because of a quirk in the existing law, only horse racecourses can be licensed to operate the totalisator in Northern Ireland, even though the law for the rest of the United Kingdom permits the tote at greyhound tracks. The Government see no reason why greyhound racing in Northern Ireland should not have the same facility, thus giving punters at the four greyhound tracks the choice of betting with bookmakers or the tote.
The order contains new rules for the conduct of bookmaking offices. Restricted sound broadcasts of race commentaries—the Extel service—will be allowed. Also in line with recent changes in the corresponding law in Great Britain, it will be possible to relax, by subordinate order, the restrictions on the facilites which may be provided in bookmaking offices. These will include television broadcasts. The Government have no immediate plans to exercise that power in Northern Ireland, but the law both here and elsewhere needs to allow for a little judicious flexibility to cope with changing social habits.
Part III of the order deals with gaming. It has five chapters. The first applies to gaming of a private kind, for example, in a family or between friends. Its aim is to force all gaming with the potential for abuse into the control system to be established by chapters II and III, as well as prohibiting all gaming in public places. Bankers' games and games which by their nature are not of equal chance, are prohibited except on domestic occasions, for example in one's own home or in places such as hostels.
Chapter II provides a comprehensive code for the control of bingo promoted commercially in private bingo clubs licensed by the courts for that purpose. The Government considered carefully whether to provide, as in Great Britain, for the licensing of gaming clubs in which other forms of commercial gaming may take place, such as casinos. We concluded that there is no evidence of any significant demand in Northern Ireland for that type of


gaming club. We have tried throughout the order not to stimulate demand for betting or gaming that does not clearly exist.
Chapter III deals with gaming by means of gaming machines. Anyone who wishes to supply or maintain a gaming machine will have to obtain from a court a certificate or permit authorising him to do so. The purpose of this and the other provisions of the chapter is to prevent racketeering and the spread of machines to places where there is no real public demand for them.
Gaming machines which may pay big prizes, usually known as jackpot machines, are prohibited except in registered private members' clubs or when used for fund raising at bazaars, sales of work, fetes or similar entertainments promoted for non-commercial purposes.
To have gaming machines, a club must register with the court, either under the order or the Registration of Clubs (Northern Ireland) Act 1967. As in Great Britain, a registered club will be limited to operating a maximum of two gaming machines. A few clubs in Northern Ireland already have more than that because the existing law has been interpreted by the courts as permitting the use of machines as a means of running private lotteries.
We see no good reason why clubs in Northern Ireland should have a greater entitlement to machines than clubs in the rest of the United Kingdom where the limit of two applies. Apart from the objections on social grounds to a greater number of machines—I do have such objections—the Government are concerned on the basis of Royal Ulster Constabulary advice that in certain areas of Northern Ireland the proceeds from the machines in certain clubs are helping to finance the operations of paramilitary organisations. Indeed, there is a strong case for a complete ban on the use of machines in clubs.
However, the Government recognise that such a ban would be regarded as unreasonable since it would unfairly penalise the majority of highly respectable clubs that have no links with the paramilitaries. Taking all that into account, the Government conclude that the limit of two is reasonable. The choice was between none at all and two, not between two and more than that.

Mr. William Ross (Londonderry, East): Instead of limiting the number of machines to two, have the Government considered limiting the stake to 2p so that more machines could be operated for the same amount of money?

Mr. Patten: We considered all sorts of options. The real problem is controlling the number of machines to ensure that paramilitary organisations do not find it easier to put a hand into the back of the machine. It is easier to meter a smaller number of machines. We considered a number of options in close consultation with the RUC. I believe that we have come to a right and sensible decision.

Mr. Roy Beggs: How many clubs does the RUC suspect are being used to raise funds for paramilitary organisations? What percentage do they represent of the total number of clubs in Northern Ireland?

Mr. Patten: I cannot give an exact figure, but it is relative small as a proportion of the total number of clubs in Northern Ireland. However, the number is sufficiently large for us to take a severe view. It is sufficiently large for us to take a similar view when preparing legislation for the registration of clubs which we hope to bring before the

House in the next Session. I am absolutely determined that we should ensure that a number of the abuses that exist at present are dealt with in that legislation.
I appreciate and sympathise with the drift of the hon. Gentleman's question. However, it seems difficult. if not impossible, to have one law for one sort of club and another law for another—to have one law, as it were, for Bangor or Holywood and another for other parts of Northern Ireland. I appreciate the strength of feeling on the subject, but we could not conceivably have made that sort of distinction.
Amusement with prizes machines which pay prizes not exceeding £3 in value are restricted to travelling showmen's fairs, licensed bingo clubs and premises of a type prescribed in regulations made by the Department and either licensed for the sale of intoxicating liquor or granted an amusement permit by a district council. These provisions are much much restrictive than those in the law of Great Britain, where virtually any type of premises qualifies.
In Northern Ireland, primarily to prevent exploitation of the machines by paramilitary organisations, but also on social and other grounds, the Government consider it essential to have the power to limit the range of premises entitled to install machines. In the short term, the Government intend that only amusement arcades and similar premises used mainly for the provision of amusements should be allowed to install machines, subject to the grant of an amusement permit by a district council.
There is no prospect in the immediate future of the Government allowing machines in other types of premises—in particular, public houses. I fully appreciate why, in this respect, the licensed trade in Northern Ireland should feel that it is being treated unfairly compared with clubs, which will continue to be allowed to have up to two machines which may be of the jackpot type. However, I trust that the House will accept and understand why the security advice must be a major consideration in deciding if and when any particular types of premises which are open to the general public should be prescribed. The Government will keep the position under close review.
Chapter IV provides for small gaming which consists of games played at entertainments promoted otherwise than for private gain. This will primarily cover such charitable and non-profit making activities as bridge and whist drives, but will also allow other games such as bingo to be promoted, for example, by clubs for the benefit of the membership in general.
Chapter V is the last chapter of part III of the order dealing with gaming. It allows clubs to make modest charges for taking part in equal chance non-banker gaming without contravening the general prohibition on participation charges in chapter I. Clubs will be able to make charges sufficient only to cover the cost of providing the facilities for the gaming. The Department may by order vary the limits on the daily charge or specify different limits for different games. The chapter also prohibits, subject to specified exceptions, the advertising of facilities for gaming and allows a landlord to evict a tenant or occupier of premises convicted of using the premises for illegal gaming.
I should, before leaving that chapter, mention that the various regulatory and enforcement functions which in Great Britain fall to the Gaming Board will be discharged


in Northern Ireland by other agencies, the courts, district councils, the police and, for some purposes, my Department.
The Government recognise that in Great Britain the Gaming Board plays an important role in supervising gaming and has been highly successful in purging it of criminal elements. However, as large-scale commercial gaming is not to be permitted in Northern Ireland, we do not think that the establishment of a Northern Ireland board would be justified. There are, in addition, security considerations which we cannot ignore.

Mr. William Ross: The Minister said that there were security considerations which could not be ignored. Is he really saying that those security considerations apply to clubs and especially to clubs that are under the control of paramilitary organisations? Was that behind his remark?

Mr. Patten: Yes, that was behind my remark, and I believe that the RUC is in a better position to deal with some of those pressures than would be, for example, the inspectors of a gaming board, even if such were necessary.
Part IV of the order deals with lotteries. It makes all lotteries unlawful, other than small lotteries at exempt entertainments, private lotteries and public lotteries promoted by a registered society for the support of charities, sports, games, cultural activities or other noncommercial purposes.
The provisions for small and private lotteries largely reenact the existing law. The major change is that societies registered with a district council for the purpose will be able to promote public lotteries. For the most part, these provisions mirror similar provisions for societies and lotteries in Great Britain. An important protection is that anyone who wishes to act as an external lottery consultant or manager will have to hold a lottery certificate issued by a court.
I have made no reference to local lotteries, such as those which local authorities in Great Britain may promote for specified objects. The Government's published proposals had provided for these, primarily so that we could test reactions, particularly the reactions of district councils in Northern Ireland. However, responses from the councils showed that few, if any, would want to run local lotteries. Furthermore, several councils strongly opposed the provision on moral and social grounds. In the circumstances, we decided, I am sure rightly, against local lotteries.
Part V deals with amusements with prizes and prize competitions. It allows amusements with prizes other than by gaming machines at non-commercial entertainments, and subject to specified restrictions on a commercial basis of travelling showmen's fairs, in licensed bingo clubs and in premises used wholly or mainly for the provision of amusements under permit by a district council.
That part re-enacts the existing law in Northern Ireland relating to newspaper and other competitions. It prohibits the conduct, through any newspaper or in connection with any trade or business, of any prize competition which involves forecasting the result of an event or any other competition in which success does not depend to a substantial degree on the exercise of skill.
Part VI covers a variety of matters. Cheating will continue to be an offence, and gambling debts will remain irrecoverable in law. The police will have rights of entry

without a search warrant to all premises with facilities for engaging in betting, gaming. lotteries and amusements with prizes and, with a warrant, to any premises at all.
That is a necessarily brief outline of the main provisions of the order. I hope that I have given an adequate picture of its principal aims. I assure hon. Members that the provisions have been carefully thought out. They have been the subject of months, indeed years, of careful scrutiny and consultation, as the House would think appropriate, with the RUC.
I emphasise that while they have been based broadly on comparable provisions in the law in Great Britain—taking account, of course, of the later recommendations of the Royal Commission in 1977–78—the Government have also taken care to ensure that they are tailored to meet the needs and circumstances of Northern Ireland. I believe that the new laws will provide a clear and firm framework which will enable gambling to take place in Northern Ireland under proper controls, and I therefore commend the order to the House.

Mr. William Ross: The Minister described this as complex law. Looking at this massive order, with its 187 articles, 21 schedules and 191 pages of legislation—a rehash of existing law, the revocation of existing law and new legislation—one sees how well-founded are the comments that regularly come from this Bench about Northern Ireland legislation. If ever there was an order which should have been treated as a proper Bill, with opportunities for adequate debate and the tabling of amendments, this is such an order. It is a huge and very important piece of legislation, yet we have to deal with it by a procedure that is seen to be more and more unsatisfactory as each order passes through the House. It is quite mad that legislation like this, dealing with such an important matter in Northern Ireland, should be dealt with in this manner.
I understand that there are all sorts of consultation periods, that the Assembly has looked at the order, and that many bodies and organisations have taken an interest in it, but at the end of the day the defects in the legislative process still remain. The Members of this House who are finally responsible for it have not had the opportunity to discuss and probe to find out what lies behind the words which appear on the face of the order.
We on this Bench give a general welcome to the fact that the law is now being not only clarified but brought together inside the pages of one document. Under the order, there is liberalisation in the law. The order might bring the law into a form that is more enforceable and will not, as the Minister said, fall into disrepute in the manner of some of the previous legislation which in many areas was not enforced.
We appreciate that the order follows closely the law in Great Britain, and we can give a general welcome to that; but, from the Minister's remarks, the House will have gathered that there are differences in the social scene in Great Britain compared with that in Northern Ireland. We would have wished to table amendments to try to make changes to meet more closely the needs of Northern Ireland.
We deeply regret that we never seem to have produced for us a complete list of the changes which have been made


in existing law, nor do we have an opportunity to examine those changes and try to work out in our own minds what they will be.
We appreciate that the Government tried to get the order passed before the summer recess last year, and that it was brought before the Assembly at that time in great haste. Now we are dealing with it a year later. If speed is so important, why has it taken an extra year——

Mr. Chris Patten: With respect to the hon. Gentleman, we published a 33-page explanatory document which fairly clearly answers some of his questions on the order.

Mr. Ross: I have read the explanatory document, but I should have liked to have rather more detail. Perhaps it is our fault for not asking for it at a much earlier stage.
The law dealing with bookmakers appears to be largely a rehash of the existing law. In some of the evidence presented to me, there were allegations that bookmakers' premises had increased in number, but the bookmakers, at another point in the evidence, alleged that 40 premises were not in operation. Is that allegation correct? If it is, can we take it that there has not been any increase in the number of bookmakers' premises in the past few years in Northern Ireland, and that the need for such premises in the community is at present adequately met?
If the number of premises is adequate, why is the concept of demand being introduced in place of the concept of need? My understanding is that there is a difference of emphasis here, and I am curious to know why we have got into this position. Does the Minister envisage the possibility of some of the larger bookmakers expanding their operations, or is he leaving the door open for further competition beween them? Indeed, I should like to have an explanation as to how bookmakers compete.
Will the Minister explain the benefits that will arise from the extension of the legislation to include greyhound racing? I know that there has been a demand for it, but I am not clear whether any real benefit will accrue to greyhound racing in Northern Ireland, given that it is controlled not from within the United Kingdom but from without. Therefore, can any real benefit be expected from the change?
I am concerned about the differences in treatment between public houses and clubs. I understand that some of my hon. Friends will be dealing with the problem of gaming machines. Over the years, the owners of public houses seem to have had a bad deal. They are not places that I frequent very much, nor do I frequent clubs. However, people complain to me that whereas clubs enjoy considerable benefits in rating valuation, the machines that can be operated, the hours of opening, the sale of alcohol and so on, with a charter to receive even more benefits, public houses, which provide similar services, are tied to the current restrictions. There seems to be a degree of inequity which should be examined. I am not happy about it, and many people in Northern Ireland are not happy either.
I have read the clubs' submissions. They say how badly off they are and how much they need the machines, but the figures which are published every year show that vast sums are received by the clubs from their sales of alcohol. Indeed, one wonders whether many public houses sell as much alcohol as is sold by some of the clubs. I should like

to know what happens to the profits from the sale of alcohol in clubs. I do not think they are doing it as a social function without profit. Therefore, I take a jaundiced view of the clubs' claim that they need the profits from the gaming machines if they are to survive. I just do not believe the stories that I am told.
Various churches in Northern Ireland have raised the question of bingo, and there was considerable comment in the Assembly. A brand-new gambling industry is coming into being. We are seeing not only the legalising of the existing position, to which a blind eye has been turned for many years, but the creation of a new commercial industry that will be different from the present one, and many people are not altogether happy about it.
I hope that the Government will keep a very close eye on the development of bingo in Northern Ireland in the coming year. I hope that they will look closely to see how the entire body of legislation, especially the new concepts in it, will work. I hope that they will be prepared, if necessary, to make further changes if they find that it is not having the good results that we hope will follow from it.
Up to now, bingo has been permitted by the RUC on the ground that it is a private lottery and can be held to fall within the law. It is only when it is openly and blatantly run as a commercial enterprise that warnings are issued and action is taken. I am aware of bingo halls being closed. I do not believe that bingo can be regarded as a lottery. I understand that cases have been fought in the courts on the question that bingo cannot be held to be a lottery because more than three numbers have to be drawn in order to get a winner. That seems to be the make or break point. The law has been openly flouted in the past The existing situation is now being legalised and a new situation is being created. Until we see the end result, we should be wary about going any further than necessary down that road.
Nobody in Northern Ireland is particularly happy about that aspect of the law. Northern Ireland is not generally a gambling society. At least, we say that it is not—sometimes one wonders. However, powerful forces in Northern Ireland view the new concept of the bingo halls arising as a result of the order with a fairly sceptical eye. I hope that the Minister will assure us that he will he very careful about the way in which that is monitored and that he will keep an eye on it over the next year or two.
There is also the whole argument about people running the various gambling organisations in Northern Ireland having to be members of the community in Northern Ireland. I can appreciate the general thrust of that argument. However, I hope that we would not be so inflexible as to bar all persons who live outside Northern Ireland, in other parts of the United Kingdom. I appreciate that there might be a problem if owners of gambling establishments lived outside the United Kingdom. That is different. However, if a ban is put on other United Kingdom citizens who live in the United Kingdom, we should see that not all such folk are banned. Some people who formerly lived in Northern Ireland still have interests there. That matter needs to be kept under review.
My understanding is that a lottery is a distribution of prizes in a competition without the use of any skill. In other words, it is pure chance. Some lotteries have been legal up to now, although in general terms all lotteries are illegal. Can the Minister tell us who in Northern Ireland would want to organise a lottery on such a scale that


£1 million-worth of tickets would be sold? Would that number of tickets be sold in Northern Ireland alone? Who would want to organise that? For what purpose? Alternatively, could tickets for the lottery be sold outside Northern Ireland? Lotteries are popular. Everyone hopes to get a plum the size of a house for a small outlay, but it does not often happen.
I do not like large lotteries, although, like everyone else in the House, I am dogged with requests to buy tickets for this, that and the other good cause. In the past, loopholes have been caused by using small print to say that the money is a donation to the charity involved—not an entry fee or anything else. I am curious as to whether such small print will be affected by the part of the order dealing with lotteries. Is it still an escape clause for those who organise lotteries, or is that loophole being closed?
One thing that has puzzled me and many people in Northern Ireland over the past year is the reason behind the Government's blunt refusal to create a gaming board in Northern Ireland. In reply to my intervention, the Minister said that security considerations were involved. What an enormous can of worms was opened up by that remark. The Gaming Board in Great Britain has been highly successful and was fulsomely praised by the Minister. Such a board is not being created in Northern Ireland. There had to be some good reason behind the Government's refusal to countenance a gaming board in Northern Ireland. It has been exposed at last—security considerations. The Government believe that only the police have the manpower, and perhaps the fire power if it comes to that, to organise raids on premises where paramilitary organisations reign supreme and to keep such premises under some modicum of control. Only the police have the expertise, the ability and the back-up to do the job that may become necessary in some aspects of the law.
If the Minister had been more forthcoming much earlier, some of the misgivings that many of us have had in regard to a gaming board and the failure to set one up in Northern Ireland would have disappeared. That was a welcome remark. In giving the reason and saying that it is a matter for the police, the Minister has cleared the air considerably. Can the Minister also tell us what steps the RUC has taken to build up the necessary expertise, and what co-operation, co-ordination and exchange of information there will be between the RUC and the Gaming Board in Great Britain, which has the body of expertise from which the Northern Ireland enforcement agency will have to draw in future? That is an important point. We should like an assurance that the police in Northern Ireland will be able to draw on the skills over here and, if necessary, personnel—only for advice—from this side of the water. We do not want the police to be bereft of the expertise that they need to deal with the matter. We are setting up a completely new group of people in the RUC to do the job in Northern Ireland that the Gaming Board does on this side of the Irish sea.
The Minister touched on the disrepute in which the present law is being held in Northern Ireland. It is a damnable thing when the law of the land is openly flouted and broken, and no attempt is made to enforce the law. I greatly welcome—as I think does everyone in Northern Ireland who is concerned with the subject—the effort that has been made to clarify the law and make it more

easily enforceable. I hope that in his winding-up speech the Minister will say that it is the intention of the Government and the police rigidly to enforce the law.
Law that is flouted eventually not only falls into disrepute, but is completely disregarded. It is difficult if it reaches that state of low esteem in the minds of the public and the police. It is difficult to retrace one's steps and try to enforce it. This is a brand new start. It is an opportunity to screw down the gambling industry in Northern Ireland and see that it complies with the regulations that the House makes. I hope that the Government will see to it that the law is enforced.
Now that we have had a chance to consider new legislation and changes that are being made to legislation, I hope that the Government are prepared to review it in two or three years at the maximum, or possibly before that. I am not absolutely sure that we have got it quite right yet. We need to keep an eye on it. We want to be assured that the Government will be prepared to look at it in future and that, if any further changes are necessary, it will be possible to make them.

Mr. Stuart Bell: I welcome the opportunity of following the hon. Member for Londonderry, East (Mr. Ross) in this short but important debate.
I have some sympathy with the interested party which, when this matter came before the Northern Ireland Assembly, found that it had to digest, in unseemly haste, 180 pages of parliamentary draftsman's language and formulate a reply—and all within eight weeks. This short debate, by its very nature, amounts to a Second Reading debate, in which we are discussing the principles behind the legislation, and a Committee stage, in which the detail, too, has to be examined.
The Minister referred to an explanatory note prepared by the Department. I found that particularly helpful. However, I wonder why it is that, for as long as we have a United Kingdom consisting of Great Britain and Northern Ireland—notwithstanding the aspiration for Irish unity which, if it does not blow with the gust of the wind of change, is nevertheless a wind that is rising and increasing in vigour—legislation for Northern Ireland, which may be modern and progressive or simply seek to bring uniformity, lags so far behind that of mainland Britain. It must be in the interests of all citizens of Northern Ireland to have the benefit of uniform legislation.
I understand that the Government wish to introduce what they describe as a single piece of modern legislation that more accurately reflects present-day attitudes to gambling and the demand for gambling facilities in Northern Ireland, which fulfils the dual purpose of attracting public support and reflecting present-day attitudes to gambling. The Minister described the order before us as lengthy and complex but pointed out that the Government were not seeking to stimulate demand for betting and gambling. He also referred to the moral and social grounds that led some local authorities to oppose the extension of local lotteries to them.
The legislation before us will last until the end of the century and well into the next. We are told that some people who were consulted regarded gambling as a sin and a wholly evil activity, which could not be reconciled with their religious beliefs and principles. In this context, I am reminded of an incident many years ago when a


Conservative Chancellor, Harold Macmillan, introduced the premium bond. I was a junior reporter at the time and all the local churches sent telegrams of dissent because they felt that the Chancellor was doing a wicked, wicked thing. Few would now look upon premium bonds as wicked, especially people who have won prizes from them, but even more especially the state, to which revenue has accrued from their sale.

Mr. William Ross: Does the hon. Gentleman agree that people who thought that premium bonds were wicked would not have bought them in the first place?

Mr. Bell: I appreciate the logic of that intervention. Many people enjoy participation in a national lottery, but the main beneficiary is the state. The Minister said that most local authorities opposed the lottery system and that the only major change in the original proposals had been to delete a provision for the running of public lotteries by district councils. I note that that change was requested by the Assembly and by several councils, which strongly opposed such a provision on moral and social grounds—I assume that that was the basis of the intervention of the hon. Member for Londonderry, East (Mr. Ross)—and on the ground that there was no demand on the part of councils to run public lotteries. Those of us who have seen the success of the French loterie nationale regret such a short-sighted decision, the only effect of which is to deprive local councils of funds.
I do not wish to reflect discourteously on the views of others, but Voltaire once said that when it comes to money we are all of the same religion. When it comes to the extension of betting, gaming, lotteries and amusements and the provision of a legal framework to encompass such activities in Northern Ireland, we are entitled as democratic Socialists to say that the people of Northern Ireland themselves must choose whether they wish to have the freedom to indulge or not to indulge in activities of that kind, bearing in mind the views of the RUC and the existence of paramilitary organisations to which reference has already been made.
I tend towards the view that gambling is an innocent leisure activity that should cause little or no harm. It is possible to lose all one's money on the horses, but it will not be possible to lose all one's money at the casino table because there is no provision for casinos. Nevertheless, when pitch and toss was illegal it was still played in the pit villages of old, with one pit lad always keeping an eye out for the local bobby. It is right, therefore, that if there is to be gambling it should be regulated and supervised within the context of a legal framework known and understood by all.
I well understand the embarrassment and shame that descended upon Downpatrick race club when bookmakers welshed on bets and failed to pay out. It is rather like the capitalist system in which we live—you pays your money and you sees the show or, as we say in law, damage lies where it falls. Bookies welshing on bets, however, is a matter for the race club rather than for the statute book—it is a fact of life and one to be avoided, especially if the punter has backed a winner.
I read with amusement that members of the Assembly committee were able to ascertain what every law student knows—that wagers are not enforceable contracts—and that if there are bookies who welsh on bets there are also punters who do not pay their betting debts. Such people are usually warned off the course.
I note that the Presbyterian Church in Ireland, meeting in Belfast, registered its strong disapproval of anything that makes gambling more attractive, tempting or popular and the Government have borne those views in mind in framing the legislation. One sure way to increase the attractions of gambling would be to cloak gambling debts with the authority of law. That has never been done so as to avoid stimulating demand and to ensure that gambling remains what it is—a pleasurable pastime and not a business or a contract carrying enforceable obligations.
I smiled, too, when I saw that although members of the Assembly opposed betting and bookmakers they thought that bookmakers' fees were too small. I have forgotten what the wages of sin is, but in relation to gambling, bookmakers' fees are apparently not high enough for such an allegedly sinful activity.
I am also somewhat bemused about why the Presbyterian Church in Ireland believes that the extension of the tote to greyhound tracks would not merely add to the attractiveness and ease of gambling and be more likely to tempt the casual punter but would be especially attractive to women. I have no idea why women should be singled out as being more likely to be tempted to gamble on such a masculine sport, but if that is the view of the Presbyterian Church in Ireland it must be so—although I am glad to note that that argument did not carry weight with the Social Services Committee of the Northern Ireland Assembly. We are as anxious for women to have a fair deal in Northern Ireland as elsewhere in the British Isles, but I doubt whether they would be especially likely to succumb to the temptations of totalisator betting at the dogs, to use a colloquial expression. I doubt, too, whether a supply of one-armed bandits, public lotteries and bingo halls will do
untold damage to the fabric of our society
or constitute
an attack on our very national character".
I accept the views of the Minister in relation to paramilitary organisations which may be involved in social clubs, but it is specious to argue that because there is now to be a legal framework for betting. gaming, lotteries and amusements, additional policing and law enforcement will be required. Even if that were so, I doubt whether if could be established as a corollary that the police would have less time for security duties or that more police or more police overtime would necessarily be required.
The Opposition join the Government in welcoming the legislation and commending it to the House.

Mr. Roy Beggs: I am not a gambler. I do not go to the horses or to the dogs, I do not play cards or bingo and I do not play any of the many amusement machines which induce people to part with hard-earned money for so-called amusement. However, I suppose that many hon. Members have gambled their previously secure careers on a somewhat precarious one. Their future depends upon those who elected them. By our endeavours, diligence and willingness to serve our constituents, we hope to persuade them to return us as Members of Parliament. But that is not provided for in the order.
Representations have been made to me by the licensed victuallers and publicans in my constituency. They feel that they have been unfairly treated. All that they want is to be given an equal opportunity with the registered clubs


to sustain their livelihood. There has been a considerable decline in the number of public houses. If the drinking pattern of recent years is maintained, pubs will continue to disappear as more clubs come into existence and obtain licences to sell alcohol. I agree with the hon. Member for Middlesbrough (Mr. Bell) that clubs obtain a substantial part of their income and profits from the sale of alcohol. The records show that there is a steadily increasing turnover in clubs from the sale of alcohol.
I am also worried that the choice offered to tourists will be more restricted if the number of public houses continues to decline. Visitors do not easily obtain membership of clubs. Public house proprietors believe that the order is a charter for clubs which already enjoy a considerable advantage over public houses. I do not agree that the claim by clubs that they need the income from amusement machines to finance the running of their club activities is valid. The same argument could be used by public house proprietors. They could validly claim that they have to pay higher rates and higher wages to retain regular staff. Some people admit that clubs contribute to the black economy because the unemployed are ready to volunteer their services behind the bar or within the club for cash payment.
The overheads for publicans continue to rise while more and more of their customers drift away and join the latest club. They have, therefore, valid grounds for complaining that they are being unfairly treated. If gaming machines can be sited in clubs where the consumption of alcohol is steadily rising, I hope that a convincing reason will be offered for denying this source of income to the public house sector.
I hope that we shall be told what control is exercised over the pay, out from gaming machines. The machine is always the winner. Those who play it live in hope of winning the jackpot. They become addicts and play for as long as their money lasts. They are like the elderly, retired lady who goes to her local golf club, has her gin and tonic first thing in the morning, collects the change from a £5 note in lop coins and plays the machines until they have all gone. Whether or not the machines pay out in the meantime, she plays until the 10p coins have run out. Amusement machines undoubtedly cause addiction.
Young people also become addicted. They live in the false hope that they will have a big win. There is evidence that not only are they prepared to spend money to satisfy their addiction but that they are prepared to steal, rob and mug in order to gamble. As the former vice-principal of a very large school, I found that the biggest single problem for my colleagues and me in 27 years was the amusement arcade craze. There was an endless trail of truancy and theft both inside and outside the school from parents or any other possible source to obtain money with which to play the machines. Nobody benefits from the gaming machines except the proprietors and those who are involved in the manufacture and allocation of the machines.
The majority of people in Northern Ireland are opposed to the installation of gaming machines in either public houses or clubs. However, they are prepared to be fair and would readily accept parity of treatment between pubs and clubs. They do not accept that amusement machines should be permitted inside clubs but not in pubs. Will the Under-Secretary of State for Northern Ireland say whether, even at this late stage, the order can be amended to ensure

parity of treatment between pubs and clubs? If he is able to justify the siting of gaming machines in pubs, I hope that he will be able to explain why they should not be permitted in public houses.
I agree that the legislation will help the Royal Ulster Constabulary in its law enforcement role. Can the Under-Secretary of State give the reason for the registration of clubs under this order? There is already the Registration of Clubs (Northern Ireland) Act 1967. If clubs are to be registered under two different measures, what are the advantages and disadvantages of each measure for clubs?

Mr. Chris Patten: The hon. Member for Londonderry, East (Mr. Ross) began this interesting, albeit short, debate by noting that this legislation is very complex. He is right about that. I note what he said about the legislative process. I was not surprised. I shall pass on his comments to my right hon. Friend the Secretary of State for Northern Ireland. He gave a general welcome to the order. We shall keep its operation under review.
The hon. Member for Londonderry, East asked why it had taken us since last summer to brine the order before the House. In our defence, I repeat what the hon. Gentleman said. This is complex legislation; it is probably the most bulky and complicated Northern Ireland legislation for 20 or 25 years. That accounts for much of the time that we have taken to bring it from the drawing board to the Dispatch Box.
The hon. Member for Londonderry, East began his detailed critique of the order by asking about the change in the criteria regarding bookmakers' offices. He may be misinformed, as others have been, about the consequences of the amendment of the 1957 Act which provides that a licence shall be refused if there are already an adequate number of licensed offices in the locality. The "adequate number" is the maximum number of offices previously licensed in the locality. However, that provision is qualified by the words
unless there are special circumstances
which have proved decisive in practice.
That ground has been replaced in the order by the provision that a court shall refuse a licence unless it is satisfied that
having regard to the demand in the locality … for facilities afforded by licensed offices, the number of such offices for the time being available … to meet that demand is inadequate".
We do not agree that that wording is less restrictive than that in the 1957 Act. I repeat that the decisive phrase in that Act was
unless there are special circumstances".
The onus will continue to lie on the applicant to satisfy the court that existing facilities in the locality are inadequate.
The hon. Member for Londonderry, East referred to the allegation that there is in the order, and more generally, an inequity between clubs and pubs. The hon. Member for Antrim, East (Mr. Beggs) made a similar point in his interesting speech. The question is whether the Government are justified in treating clubs and pubs differently in relation to gaming machines.
Unlike licensed premises, clubs are not open to members of the public and are not run for avowedly commercial purposes; therefore the Government accept that, as in Great Britain, private members' clubs in Northern Ireland should be allowed to operate up to two jackpot machines, which is fewer than they can operate at present.
Although licensed premises in Great Britain may be authorised to operate amusement-with-prizes machines, the Government consider that in Northern Ireland, because of its special security problems and because of the need to prevent exploitation of gaming machines by criminal and other undesirable elements, it is essential to be able to control strictly the types of premises open to the public that should be allowed to have such machines.
Decisions on whether particular types of premises, such as pubs, should be prescribed for that purpose, will be taken in the light of prevailing circumstances, having regard, among other things, to the advice of the police. All life is about drawing lines. On security grounds, we have drawn the line in this place on this occasion. However, in responding to the major anxieties of the hon. Members for Londonderry, East and for Antrim, East, I repeat that we hope to legislate on liquor licensing and on clubs in the next Session. I trust that that will remove the sense of unfairness that lingers, as I know from having met representatives of publicans.
The hon. Member for Londonderry, East referred to commercial bingo and suggested that there might not be much evidence to support our proposal to allow bingo clubs in Northern Ireland. He also hinted that we might be encouraging reckless spending at the expense of housekeeping needs.
There is adequate evidence of demand for bingo in Northern Ireland where, in recent years, a number of private clubs have been established. Strictly speaking, bingo is illegal, except when run as a private lottery or for non-commercial purposes. There are grounds for believing that a number of existing clubs are primarily commercial ventures.
The Government believe that, where there is a discernible public demand for this sort of activity, it is preferable to recognise that fact and to allow it be run legally and subject to appropriate controls. That is what the legislation aims to do.
The Royal Commission on gambling in Great Britain found in 1977–78 that it had not been possible to substantiate suggestions that bingo clubs had been the cause of family neglect and that overspending in clubs at the expense of housekeeping contributed to domestic friction. There are many more important reasons for domestic friction. On the contrary, the Royal Commission accepted that the clubs provided a valuable social function in relieving loneliness and boredom and by providing places where people could meet socially and at little expense. The number of bingo clubs in Northern Ireland will be restricted to what the courts consider justified, having regard to the demand for such facilities and the extent to which they are available in the locality.
The hon. Member for Londonderry, East asked about residential requirements. We appreciate that the requirement that applicants seeking licences under the order should ordinarily reside in Northern Ireland may present difficulties for some individuals or companies, particularly because of the introduction of legal restrictions in some areas not covered by the existing law.
The purpose of the residential requirement is to facilitate enforcement of the law and to enable the police and the courts to be satisfied of the fitness of applicants for various licences under the order, including licences for bookmakers, bookmaking offices, bingo clubs, gaming machine certificates and so on. I am sure that hon. Members will accept that a residential requirement is

essential. The advice from the RUC was that 12 months was the minimum period of residence that would be appropriate.
As a residence requirement would apply to an individual and to members of a partnership seeking a licence, it is logical that the same requirement should apply to those responsible for the local management and control of a company. That is in line with the policy followed generally by the Gaming Board in Great Britain, which almost invariably insists that the directors, or at least a majority of them, of a company seeking a certificate of consent or a gaming machine suppliers' certificate should reside in Great Britain.
In effect, therefore, a Northern Ireland enterprise wishing to extend its operations to Great Britain would encounter the same difficulties as would a company from Great Britain wishing to operate in Northern Ireland. Of course, it is open to any company to establish a locally based subsidiary company under the control of locally resident directors, thereby meeting the residence requirement in the order. I hope that that will provide the sort of flexibility that the hon. Member for Londonderry, East seeks.
The hon. Member asked about the benefits of the operation of the tote at dog tracks. Representatives of greyhound track operators have insisted for many years that the lack of that facility has had a detrimental effect on their business and on the greyhound industry generally. I sympathise with that view.
The hon. Member for Londonderry, East asked whether lottery tickets could be sold outside Northern Ireland. That would depend on the relevant social law applying in the country in which the tickets were to be sold.
The hon. Gentleman understandably dwelt at length on our decision not to establish a gaming board in Northern Ireland. I draw his attention again to the security considerations to which I referred earlier.

Mr. Bell: The Minister mentioned companies in Northern Ireland in the betting business. Will he confirm or comment on the possible gain of 240 jobs in Northern Ireland and the generation of an extra £6·92 million for the public purse if gaming laws in Northern Ireland were brought into line with those in the rest of the United Kingdom?

Mr. Patten: The hon. Gentleman might have pool betting in mind. Throughout the consultation period, we received no representations on that subject. Had we clone so, we should have taken account of those representations when drafting the order. By the time that we received those representations, we were unable to redraft the order. We have made it clear throughout that we are trying to meet known existing demand rather than to stimulate demand. In any future amendments of the legislation, we shall have to take account of the representations made to us.
I suppose that it would be possible to argue that, if we had allowed the establishment of casinos in Northern Ireland, it might have created a great deal of employment. However, I do not think that there is an existing demand for casinos. We would have stimulated it, and much against the judgment and social habits of many people in Northern Ireland who would have found casinos offensive. I am always prepared to meet and, I hope, deal helpfully with people who make proposals to create employment in


Northern Ireland. I have met some of the representatives of the interests to which the hon. Gentleman referred before and I would be happy to meet them again.
The need for a gaming board in Great Britain arose primarily from the decision to allow commercial gaming clubs there. As there is no evidence of demand for such clubs in Northern Ireland—the order does not provide for them—it is considered that the establishment of a gaming board would not be justified. The certification and policing functions related to other types of gaming activity carried out by the board in Great Britain will be discharged, where appropriate, by other bodies in Northern Ireland including the courts, the local authorities, the police and, for certain purposes, the Department. I hope to satisfy the hon. Gentleman that the RUC will take appropriate measures to ensure that it can uphold this law.
In an interesting speech, the hon. Member for Middlesbrough (Mr. Bell) referred to the limit on the time that we have given the Assembly to consider this extremely complicated piece of legislation. A limit has to be put on consultation periods. We were anxious to press ahead with such speed as the complexity of the legislation allowed, but we were able to take account of comments made by the Assembly and others after the end of the consultation period.

Mr. Bell: Will the hon. Gentleman confirm the Assembly's disappointment at the Government not accepting more of its recommendations? I understand that the order includes but two of the Assembly's 15 suggestions in full and another two in part. Does he agree that that reflects the curious dichotomy in the thinking of those who want legislation relating to Northern Ireland to approximate to that for the rest of the United Kingdom but who, when confronted with legislation with that in mind, back away from it so quickly that the obverse turns out to be true? The public perceive that there are such differences in outlook and temperament that, in the end, separate legislation is necessary. Would the hon. Gentleman like to spend a moment discussing that attitude in the Northern Ireland Assembly?

Mr. Patten: It is not for me, but perhaps for divine providence, to fathom the workings of the Assembly on this issue. The hon. Gentleman criticised us for not accepting local lotteries. That was one of the Assembly's suggestions that we accepted. Some of the arguments that lay behind the Assembly's recommendations were a little Byzantine for me. I think that we have taken adequate account of the Assembly's recommendation.

Mr. James Molyneaux: Does the Minister recall that, when the ill-fated Northern Ireland Act 1982 was going through the House, many of us warned—and the House generally agreed—that, if a body were established without being given any responsibility, it could be expected only to be irresponsible and unconstructive?

Mr. Patten: I have had the opportunity, since I have taken a more active interest in the affairs of Northern Ireland than I took in 1982, to take a certain amount of Northern Ireland legislation through the House. On most occasions when I have had that great privilege we have

dealt with Assembly recommendations that have been more helpful than they were on this occasion. I do not mean to criticise the committee over which one of the right hon. Gentleman's hon. Friends presided with such distinction, but we have had more useful reports on other orders. I understand some of the social pressures that made it difficult on occasion for the Assembly to deal as one might have liked with this order.
I accept that there is a demand for lotteries. We are meeting it in the order. All that is at stake today is whether we have been right to say that district councils should not run local lotteries. As local councils did not want to run local lotteries, I do not think that we would have been right to force them to do so.
The hon. Member for Antrim, East said that he is not a gambler and therefore came to this subject with some humility. My knowledge of this subject is not based on anything so vulgar as experience, though I did once go into a betting shop.
The hon. Gentleman referred to what the hon. Member for Londonderry, East said about the comparison between the treatment of pubs and clubs. I think that I have dealt with that matter in my response to the hon. Member for Londonderry, East. As for control on pay-outs from machines, we are establishing a regime of controls under chapter III of part III and in schedule 11. I hope that they will be adequate.
We realise that the order raises important social and environmental issues and that many people hold strong, albeit widely divergent, views about what legislation on these matters should contain. We are also conscious of the serious harm and suffering that excesses of gambling can cause individuals, their families and society. We are also conscious of the need to ensure that facilities for gambling will not be open to exploitation by criminals and other undesirable elements in the community.
However, we respect the freedom of the individual and do not want to interfere any more than is necessary in activities which, for the vast majority of those who engage in them, are normally quite harmless. We also accept that, when there is demand in a substantial section of the community for facilities that enable them to participate in various types of gambling, it is neither realistic nor desirable to attempt to suppress such activity. We have borne all those factors in mind when considering what measures would be appropriate for Northern Ireland.
It is inevitable that, when dealing with issues of this type, finely balanced judgments have to be made. That applies no less to Governments than to individuals. Although we make no claim to infallibility in this respect, we believe that the order achieves a reasonable balance between the legitimate interests of those who want the law to reflect the demand for gambling facilities, and the need to ensure that gambling takes place in a framework of statutory control that protects the interests of society in preventing abuse of those facilities. In that spirit, I have great pleasure in commending the order to the House.

Question put and agreed to.

Resolved,
That the draft Betting, Gaming, Lotteries and Amusements (Northern Ireland) Order 1985, which was laid before this House on 26th June, be approved.

It being Eleven o'clock, MR. SPEAKER interrupted the proceedings, pursuant to Standing Order No. 5 (Friday sittings).

Top Salaries Review Body

Mr. Roy Hattersley: (by private notice) asked the Prime Minister if she will make a statement on the report of the Top Salaries Review Body.

The Chief Secretary to the Treasury (Mr. Peter Rees): I have been asked to reply. I have nothing to add to the written answer given yesterday by my right hon. Friend the Prime Minister to my hon. Friend the Member for Mid-Worcestershire (Mr. Forth).

Mr. Hattersley: Clearly, the Prime Minister, who has direct responsibility for these matters and who is in London this morning, should have had the courage to answer. The fact that she chooses to hide behind the Chief Secretary, of all people, shows the depths of desperation in which the Government find themselves. Although the Chief Secretary may have nothing to add now, sooner or later public opinion will make the Government add something to yesterday's inadequate statement.
How do the Government justify abolishing wages council protection for young low-paid workers one day and awarding a salary increase of £23,750 a year to the Secretary to the Cabinet the next? Have the Government now converted to the principle of comparability, or has comparability simply been wheeled out as an excuse to pay massive wage increases to the already highly paid?
If comparability is something more than camouflage, is the principle to be applied throughout the public service? Can the job that Lord Plowden did with such success for top salary earners be extended to other areas—the teachers and Lord Houghton, the miners and Lord Wilberforce, the nurses and Lord Halsbury, and local authority manual workers and Professor Hugh Clegg? The Government have denounced all those cases of comparability. The Chief Secretary had better tell us whether they have mended their ways and now believe that that is the proper way to proceed.
Will the Chief Secretary tell us about the two justifications which have been offered for the review? The first is that these people pay particularly high levels of taxation. I hope that the Chief Secretary has the grace to admit that these people—the top salary group—are the only section in the population who have received any net benefit from the Government's taxation policy. It is the one group that is paying less tax than before 1979. Eighty-seven per cent. of the population is paying more, and the Chief Secretary had better admit that.
The second justification is that the increases are necessary to recruit the right sort of people. That is what the Government spokesman said on the radio this morning. At present salary levels are the judges inadequate, the generals inefficient and the permanent secretaries incompetent, especially those who have been hand-picked by the Prime Minister during the past two years? Clearly the Prime Minister was desperate to avoid a debate on the subject, but she cannot run away from the consequences of her philosophy, which are demonstrated by this decision.

Sir William Clark: Will the right hon. Gentleman give way?

Mr. Speaker: Order. There is no question of giving way in the middle of a series of questions.

Mr. Hattersley: Whatever the hon. Member for Croydon, South (Sir W. Clark) may wish to say, he would

defend the Government if they decided to kill the first-born on 23 December one year. Whatever he may say, the public relations image of compassionate Conservatism lasted for about 48 hours, as witnessed by the fact that the Chief Secretary, of all people, was wheeled in for today's statement.
The Government have one rule for the rich and another for the rest. It is that commitment to the divided society which makes the Government increasingly despised throughout the country.

Sir William Clark: On a point of order, Mr. Speaker You will recall that during his long harangue the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) said that I would support the Government, even if they killed the first-born. Surely that is so offensive that it should be withdrawn immediately.

Mr. Speaker: If the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) made that accusation, I am certain that he would wish to withdraw it.

Mr. Hattersley: Further to that point of order. Mr. Speaker. The remark was intended as an image, but if the hon. Member for Croydon, South (Sir W. Clark) wishes to take it literally I withdraw the literal interpretation, if not the image that I implied.

Sir William Clark: rose——

Mr. Speaker: Order. A full withdrawal would settle the matter.

Mr. Hattersley: Gladly.

Mr. Rees: I shall not attempt to match the indignation of the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley), except to remind him and the House that in 1978, when he was a member of it, the Labour Cabinet accepted the recommendation of the Top Salaries Review Body for salary increases of 35 per cent. for the grades covered. I hope that I can deal more coolly with the matter than the right hon. Gentleman, with his highly charged questions.
The problem with wages councils is different, and, therefore, our responses have been different. In some cases the recommendations of wages councils have made it more difficult, not easier, for young people to find jobs, and that is the problem that we are addressing.
In this case—I come to the right hon. Gentleman's last point—the question relates to recruiting and retaining people of high quality. Obviously the existing holders of those offices are of the highest quality, and no implied criticism is contained in the Prime Minister's second justification. We must ensure the right quality of successors.
If the right hon. Gentleman had taken the trouble to study the report, especially paragraph 67, he would have found that comparability was not the predominant influence on the review body. Indeed, it said that if it had based its recommendations purely on the comparability principle, it would have recommended much higher figures.
On the question of high levels of taxation, the right hon. Gentleman did not pay attention to our debates on the Finance Bill; otherwise he would recall that we have directed most attention to the thresholds, which have been increased by 20 per cent. in real terms since we came to power in 1979.

Mr. Eric Forth (Mid-Worcestershire): Will my right hon. and learned Friend confirm that the number of people involved in the recommendations amount to 2,000, and that in considering a reward the numbers involved must always be borne in mind? Will he further confirm that, if we appoint review bodies, it does not make sense to ignore what they say? Is it not a fact that we accepted the review body's recommendations on nurses' pay, although pay was staged? Are not these recommendations also staged in recognition of the need for restraint in this matter? Will he further confirm that in the Prime Minister's answer to my question a great deal of stress is placed on individual merit and performance, that the awards are being made in that context, and that we want increasingly to move in that direction?

Mr. Rees: My hon. Friend is right, in that slightly more than 1,800 people are involved. The increased cost will be absorbed in the running costs total, so the cash limits will not be breached. He is also right in what he says about accepting the report. When the review body was set up in 1971, together with the review bodies for the armed forces, doctors and dentists, my noble Friend Lord Carr announced that the Government would not modify the recommendations unless there were clear and compelling reasons. We have made some slight modifications in this case. Nevertheless, we continue to adhere to the principle announced by my noble Friend.

Mr. James Molyneaux: In view of the opposition expressed to the increases in top salaries, does the Chief Secretary expect similar opposition to inappropriate increases in Members' salaries, which would add another 650 to the total of 2,000?

Mr. Rees: I do not wish to anticipate anything that might be done with regard to Members' salaries, and I accept no ministerial responsibility for them.

Mr. Fred Silvester: If, as my right hon. and learned Friend claims, the report is not based upon comparability, is it not important that we should be sure on what basis the awards are being made? Therefore, is not an important consideration the question of relative justice between groups?

Mr. Rees: Relative justice between groups is highly subjective. I am not sure which groups my hon. Friend has in mind. The part of the report that commended itself most to the Government dealt with the recruitment and retention of people of the right quality to fulfil tasks of the greatest responsibility in the service of the Crown.

Mr. Michael Foot: Is it not especially offensive that such whacking increases should be given to civil servants who have been instructed by the Government to resist the partial restoration of standards for nurses and teachers? Will the Government proceed at once, on the basis of the top salaries report, to restore the standards which nurses had under Halsbury and which teachers had under Houghton?

Mr. Rees: The right hon. Gentleman forgets what has happened to the nurses under this Administration. Their salaries have increased by 90 per cent. in cash terms and by 20 per cent. in real terms. Also, if the right hon. Gentleman searches his conscience, he may be uneasy about what the Labour Government did for the teachers.

Sir Peter Emery: Does my right hon. and learned Friend accept that all Conservative Members

support the Government's desire to reduce inflation? However, does he understand that this award will push the loyalty of many Conservatives in our constituencies a very long way? Did not the Prime Minister suggest that Members of Parliament and others at the top of the salary scale should be restrained and should give a lead to the rest of the country? The Government must realise that there will be considerable criticism of this award, when we are offering only 6 per cent. to teachers and have given only a small increase to nurses.

Mr. Rees: Of course, I note my hon. Friend's concern and that of his constituents. However, I have no doubt that he will explain to his constituents the difference between those in the public service to which these recommendations relate and Members of the House, who are responsible for fixing their own salaries. That is not true of the heads of the Civil Service or the armed forces.
May I emphasise the position of my right hon. Friend the Secretary of State for Education and Science, who said that he would welcome a restructuring of teachers' salaries, with special emphasis on the position of head teachers.

Mr. Willie W. Hamilton: Does the Chief Secretary accept that the people who will get these massive increases in salary are the people who have had massive tax concessions from the Government since they came into office in 1979? Is it not a further example of the Government's insensitivity, and their determination to clobber the poor, whether they be nurses, teachers or the young unemployed, and to mollycoddle the rich? Is it any wonder that many Conservative voters and Members are becoming increasingly disenchanted with the massive injustices perpetrated by the Government?

Mr. Rees: I may be unable to persuade the hon. Gentleman, but I could persuade the majority of hon. Members to accept that tax rates of 98 per cent. and 83 per cent. can hardly be regarded as just, or as assisting our fellow countrymen. We put those injustices right, and we have also directed resources to raising the starting point for tax, which has benefited those for whom the hon. Gentleman affects concern.
Since the hon. Gentleman has again asked about nurses' pay, may I repeat that if nurses' pay had stayed at the real level inherited by the Government in 1979 the pay of a staff nurse on the maximum rate would now be £2,000 less. That is a measure of our concern for the nurses, which is greater than that of the Labour party.

Sir William Clark: Does my right hon. and learned Friend agree that the real issue here is the retention of the right calibre of civil servants so that they can carry out the duties for which they are responsible? Is he aware that it is becoming increasingly difficult to recruit top grade accountants to the National Audit Office? Will he remind the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) that he was wrong to suggest that I am a spokesman for the Government?

Mr. Rees: My hon. Friend has made several effective points, and has made his position clear. May I refer the House to the last sentence of paragraph 39 of the report, which states:
Good quality cannot be obtained on the cheap in a competitive market place which, increasingly, is an international one for the best management talent.

Mr. Clement Freud: Why is the Chief Secretary so worried about losing the best and brightest civil servants and so cavalier about losing the best and brightest teachers and nurses?

Mr. Rees: The hon. Gentleman cannot have heard my answer to a supplementary question from my hon. Friend the Member for Honiton (Sir P. Emery). My right hon. Friend the Secretary of State for Education and Science has made it clear that he would welcome a restructuring of teachers' salaries, with special emphasis on the position of head teachers. We wish to ensure that people with responsibility and with special talents in the teaching profession, as elsewhere, are properly rewarded.

Mr. Roger Sims: Can my right hon. and learned Friend explain the ambivalent attitude of Opposition Members, who appear to advocate the rate for the job for sonic groups but not for others? How and where do they draw the line? Do they base their calculations on responsibility, on salary or on political expediency?

Mr. Rees: My hon. Friend has exposed the synthetic indignation of the Opposition and their complete failure to grasp the reality of the present position.

Dr. M. S. Miller: If, as the Chief Secretary says, the intention of this grotesque distortion in salary scales is to retain the right calibre of people, why is it that some under-secretaries will receive only 5·1 per cent. increases, while their bosses will receive 46 per cent. increases? Are the under-secretaries not of the right calibre?

Mr. Rees: I have not suggested that. Of course, they will be encouraged by the glittering prospects available to them if they stay in the service.

Mr. Nicholas Fairbairn: Will my right hon. and learned Friend explain to the House how often the top salaries of those involved have been held back because of the political guilt kick, which we have heard expressed by the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley)? Will he make it plain that these increases will make up for increases that were funked, wrongly, in the past?

Mr. Rees: My hon. and learned Friend is right. We have had about 22 reports from the body, and it makes a more extensive review every three years. Without notice of my hon. and learned Friend's question, I cannot say exactly what the Labour Government's decision was on each occasion, but I repeat that, in 1978—I give them full credit for it—they did not flinch from increasing salaries in line with the body's recommendations.

Mr. Donald Stewart: Is the Chief Secretary aware that this action will engender massive resentment and disgust in the country, not confined to supporters of the Opposition, especially when it has come from a Government led by a Prime Minister who had the gall to quote the prayer of St. Francis of Assisi when entering No. 10 Downing street? Does he agree that this will be a signal to the nurses, the teachers and to others struggling to obtain a decent wage not to pay the slightest attention to any of the Government's sermons on wage restraint?

Mr. Rees: This conclusion of the Government will excite indignation only if the wilful misrepresentations of the right hon. Member for Western Isles (Mr. Stewart) and the Opposition parties go uncorrected.

Mr. Ivan Lawrence: Is it not true that there is never a popular time to make necessary increases of this kind and that it is characteristic of the Opposition parties that their indignation is always bogus, their grasp of reality is always tenuous and their appeal to envy and class hatred is constant?

Mr. Rees: My hon. and learned Friend has accurately sized up the approach of the Opposition parties to this problem.

Mr. Stuart Bell: What message has the Chief Secretary for those in the north-east, 250,000 of whom have been unemployed since 1979 and 450,000 of whom live below the decency threshold level of the Council of Europe? Is the message for those people that if Thatcherism is not working for them it is not working either for those top people who need to be recruited into the Civil Service by such massive pay increases? Is the right hon. and learned Gentleman saying that, if they do not have these increases, they will leave the country?

Mr. Rees: I suspect that the people for whom the hon. Gentleman professes to speak will appreciate that it is better to have a high quality Civil Service and high quality armed forces than to have their position constantly eroded by the envy, malice and misunderstanding of the Opposition.

Mr. Robert Adley: Can my right hon. and learned Friend confirm that, unlike, for example, the hon. Member for Middlesborough (Mr. Bell), the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) or me, the people who are receiving these increases are unable to earn large sums of money in addition to their salaries? While it may be unoriginal, is it not always true that the poor are not helped by attacking the rich? Does my right hon. and learned Friend agree that the Labour party, the Liberal party and the Social Democratic party have given notice to anyone with talent and ability that he need not expect his talent and ability to be rewarded by any future Government in which any of those parties has any part to play?

Mr. Rees: My hon. Friend has succinctly summed up the message that goes out every time that the Labour party cares to disclose its policies, which it does very rarely. The other parties are so thinly represented here at the moment that I would not care to speculate on their position.

Mr. Dennis Skinner: Is the Chief Secretary aware that, in view of the expected Government reshuffle, his statement today may be the last one that he will make on behalf of the Government?
Is it not fair to say that the Government are not beset by communication problems and presentational difficulties? The point is that the Government are determined to look after those at the very top. Having allocated tax cuts to the top 6 per cent. in society, they have the nerve to hand out these massive pay increases to top civil servants and all the rest, none of whom works in an economic unit of production, as opposed to pensioners who have been offered about 7 per cent., nurses who have been offered 7 per cent. coupled with the threat to take some of it back, and local authority manual workers who were offered 4 per


cent. last year and probably will be offered the same again this year. All these groups in society are deliberately hammered by this Government so that they can better look after their own class. It is time that the Chief Secretary, when he loses his job in the autumn, took the whole caboodle of the Tory Front bench with him. The best thing that this Government can do is resign and get out of the way.

Mr. Rees: I should not expect the hon. Member for Bolsover (Mr. Skinner) to understand the scale of responsibilities carried by the people for whom the review body has made these recommendations.

Mr. Michael Howard: Does my right hon. and learned Friend agree that exceptional ability, exceptional responsibility and exceptional effort should be accorded exceptional reward? Is not this proposition recognised universally in all the most successful economies? Is it not the case that the greater the extent to which it becomes recognised here, the greater are our prospects of establishing ourselves amongst the most successful economies, to the benefit of all our people?

Mr. Rees: I accept entirely the principles enunciated by my hon. and learned Friend. Would that the Opposition had the same clear-sighted appreciation of what the country requires.

Mr. Dick Douglas: Will the Chief Secretary give consideration to the feeling in Scotland, especially amongst the teachers, who have been arguing for more than a year for the creation of an independent salaries review body? Unfortunately, there is no Scottish Minister present to advise the right hon. and learned Gentleman. Scottish teachers have been arguing for such an independent review body to evaluate their position in society, only to see these rewards being given by the Government to highly paid people. Will the right hon. and learned Gentleman try to evaluate the resentment in Scottish schools and Scottish education and the damage that the Government are doing?

Mr. Rees: I shall not trespass on what is a particularly Scottish problem, although I doubt whether it is a particularly Scottish problem. However, I remind the House that the loss of relative value in teachers' pay occurred between 1975 and 1979 after the Houghton award had stoked up inflation.

Mr. Harry Greenway: Is my right hon. and learned Friend aware that I am one who supports a proper wage rise for teachers and that I am also one who was paid the Houghton award of 1974? I was in the profession between 1974 and 1979 and saw that pay award eroded by a Labour Government and a Lib-Lab Government of which the right hon. Member for Blaenau Gwent (Mr. Foot) was a member. We were much worse off then than teachers are now. I also remember Mrs. Castle saying to teachers in an early dispute with the Labour Government for higher pay, "Good luck to you," but she was in the Cabinet which refused us an increase. What hypocrisy! Will my right hon. and learned Friend comment on the gross hypocrisy and absurd position of the Labour and Liberal parties on teachers' pay?

Mr. Rees: It is beyond me to comment effectively on the hypocrisy of the Labour party. However, I am glad that my hon. Friend, speaking from first-hand experience. has set the record right.

Mr. Tom Clarke: Does the right hon. and learned Gentleman regret that his engagements last night did not allow him to be present to hear my Adjournment debate during which I put forward a case for a very seriously ill man who twice applied——

Mr. Speaker: Order. This is a bit wide of the Top Salaries Review Body's recommendations.

Mr. Clarke: My point is that this man's claim was rejected by some of the people who today are to be given these massive increases. Will the Chief Secretary accept that people are sick and tired of government by the establishment for the establishment and of the arrogance of intellect coupled with the brutality of power?

Mr. Rees: I am sorry that I did not have the privilege of hearing the hon. Gentleman's intervention last night. I shall study the record in Hansard, though I doubt whether that problem was the responsibility of any of the civil servants or members of the armed forces for whom these recommendations have been made.

Mr. Hugh Dykes: Will my right hon. and learned Friend not be deterred by the hysteria on the Opposition Front Bench and elsewhere from putting, as he has done, the case for high salaries for high responsibilities in the public service? However, will he please think again about his surprising assertion that, because Members of Parliament can fix their own wages, they are in a different category? If the Government had accepted the independent recommendations two years ago of the same investigator. that problem would not have arisen.

Mr. Rees: I take note of what my hon. Friend says. I think that I should be going a little wide of the subject if I were drawn into commenting on the salaries of hon. Members.

Mr. Max Madden: Is the Chief Secretary seriously asking the public to believe that increases for permanent secretaries of between 32 per cent. and 46 per cent. are necessary to stem the fall in their morale and to stop civil servants and others feeling like parasites? Does not he understand that many in the Civil Service, especially in the lower ranks, have low morale and feel like parasites because the Prime Minister and her Government have never ceased denigrating public service ever since they assumed power? Why do the Government think that they can have teachers and nurses on the cheap? Why is it necessary for the poor to accept wage cuts to make them work harder whilst the rich must always have more to make them work harder?

Mr. Rees: The hon. Gentleman seems to be a little confused. We have deep appreciation of the dedication and contribution of civil servants and the armed forces. They should be properly rewarded, and I hope that, particularly after this, they will so regard it. Our record on the Civil Service stands the closest possible examination, and I am happy to rebut the hon. Gentleman's distortions.
The hon. Gentleman returned to the point about teachers' pay. As my right hon. Friend the Secretary of State for Education and Science has emphasised, we would be delighted to see restructuring to give emphasis to special skills and responsibilities.
As to the case of nurses, the hon. Gentleman had better study Hansard tomorrow. I have set out not once but three times how our record stands the closest possible comparison with that of the Labour Government. The cash increase for nurses has been about 94 per cent. and the real increase about 20 per cent. Every nurse and staff nurse would be far worse off if the levels of pay for that dedicated profession that we have inherited from the Labour Government had been perpetuated.

Several Hon. Members: rose——

Mr. Speaker: Order. I remind the House that this is a private notice question and I have an obligation to protect the Northern Ireland business. I propose to allow questions to continue for a further five minutes and then we must move on.

Mr. Roger Gale: My right hon. and learned Friend will have noticed that, almost to a man, Opposition Members have advocated upward comparability. Does he recognise that there are Conservative Members who believe that the way to control the inflation with which the Labour party, when in power, nearly destroyed the country is through restraint, and that restraint must apply to top salaries as well as to others?

Mr. Rees: My hon. Friend will have noticed that we have not implemented the recommendations in full. He is right to remind the House that the standard of living and savings of most sectors of our community were eroded to an incomparable degree by the inflation that prevailed under the last Labour Government.

Mr. Ernie Roberts: rose—[Interruption.]
This is not a bit of fun, although it may be funny to the Tories. Is the Minister prepared to tell the 4 million unemployed, the 1 million homeless, the 600,000 waiting for hospital treatment, the old-age pensioners and the young unemployed that it is they who will be making the sacrifices to pay for these £500 a week increases?

Mr. Rees: To set the record right, in case anybody should be misled by the hon. Gentleman's misunderstanding of the facts, I point out that the cash involved in a full year will be £9 million, and this year it will be £4 million. I emphasise again that this will be absorbed into the running costs and cash limits of the Department concerned.

Mr. J. F. Pawsey: Can my right hon. and learned Friend confirm that the pay review body is impartial, and that its findings are based on a careful evaluation of the facts before it?

Mr. Rees: It is a completely impartial body and it has never been suggested, even by Labour Members, that it is not.

Mr. Dave Nellist: The two-faced actions this week by the class-ridden Tory Government show one thing. On Wednesday, they tell half a million youngsters, some of whom are on £29·70 a week, that they are pricing themselves out of jobs. On Thursday their friends in high places, the ones they share clubs and restaurants with, and went to school with, and into whose families they married, who are served by those youngsters in hotels and restaurants and shops are told that they can

have a rise of £460 a week. Is not that a clear sign of a class-ridden Government that should be swept from office?

Mr. Rees: I do not know the hon. Gentleman's definition of a class-ridden Government, but I suggest that he studies the differentials in the Soviet Union.

Viscount Cranborne: Does my right hon. and learned Friend share my sense of relief that my hon. Friend the Member for Croydon, South (Sir W. Clark) does not intend to participate in the massacre of the first-born? Will he confirm that the Government are already having difficulties in recruiting judges and potential senior civil servants?

Mr. Rees: I know that the House will not regard my hon. Friend the Member for Croydon, South (Sir 'W. Clark) as having Herodian sentiments in this or in other parts of public sector activity. I am grateful to my hon. Friend for drawing attention to the central point, which is dealt with at various points in the review body's recommendations, that there is difficulty in recruiting in certain sectors, and certainly difficulty in retaining people at various grades. I am sure that the House will join in believing that we should have high quality armed services, and a high quality public service generally.

Mr. Tony Lloyd: Does the Chief Secretary have any real conception of how yesterday's decision will be greeted by those young people for whom this Government offer no employment prospects, a reduction in supplementary benefit and destruction of the wages council provisions giving them a minimum level of protection? How will he persuade them that we live in one nation?

Mr. Rees: The hon. Gentleman either does not understand or wilfully misunderstands the Government's intentions. If he had listened closely to the careful case for reform of the wages councils, he might be able to explain to young people that it will enhance rather than diminish their chances of finding work. He might also remind them of the considerable resources devoted at Budget time to increased training and various job creation schemes.

Mr. Adley: On a point of order, Mr. Speaker——

Mr. Speaker: Order. We are running short of time. What does the hon. Gentleman wish to say?

Mr. Adley: The hon. Member for Coventry, South-East (Mr. Nellist)—[Interruption.] I am sorry, but intend to pursue this matter. The hon. Gentleman deliberately used, in a loud voice, the word "hypocrite" to describe my right hon. and learned Friend the Chief Secretary——

Mr. Speaker: Order. I hope that, in this highly charged situation, hon. Members will moderate their language.

Dr. Keith Hampson: Is it not the case that, when the Labour party and the alliance were trying to score cheap political points over the appointment of Mr. Peter Levene, they fully recognised the serious problem of senior civil servants drifting into the private sector? Is there not much humbug among Opposition Members? Only a month ago, in the defence debates., leaders of both parties were calling on the Government to do more to stop the drift of officers into the private sector.

Mr. Rees: My hon. Friend is right. The Labour party has never realised that there is an open international.


market for talent. If the country is to be well administered, and if our prospects are to be maintained at a high level, it is important that we should recruit, retain and motivate the highest quality people to serve in the armed forces and Civil Service.

Mr. Hattersley: The Chief Secretary will have heard criticism of the Government's proposals from both sides of the House, and most eloquently from the hon. Member for Honiton (Sir P. Emery) and others of his hon. Friends, both now and at about 9.30 this morning. As the feelings on both sides of the House are so strong, does he understand that it will be intolerable if these decisions are implemented before they are debated in the House of Commons; and when they are debated we hope that the Prime Minister will have the courage to come to defend them herself?

Mr. Rees: I make it clear that my right hon. Friend the Prime Minister is concerned with these matters, but she has a meeting with a visiting Head of State this morning. The possibility of a debate is a matter for my right hon. Friend the Leader of the House and the usual channels.

Mr. Alan Williams: On a point of order, Mr. Speaker. You will have noticed that this morning—and Friday mornings are not notable for a strong attendance in the Chamber—more than 30 hon. Members on both sides of the House have tried to put questions on the statement. Undoubtedly there would have been more had the statement been made on a normal working day. There might even have been a spokesman from the SDP present.
I need your advice and help, Mr. Speaker. Is it not clear that there is a need for a full debate on this package of pay proposals, particularly as the Government are about to add a Cabinet Minister to all those who are aboad this high-wage gravy train? As only five more working days are left before we go into recess until the end of October, will you, on behalf of the House, use your authority to convey to the Prime Minister not only our deep concern but our strong feeling that the Government should not be allowed to evade a full debate in prime time?

Mr. Speaker: The House knows that that matter is not in my hands. The Adjournment motion is due to be considered next week. Whether we adjourn for the summer recess is in the hands of the House.

Business of the House

The Lord Privy Seal and Leader of the House of Commons (Mr. John Biffen): With permission, Mr. Speaker, I should like to make a short statement about the business on Tuesday 23 July.
In addition, at the end there will now be a motion on the Lord Chancellor's Salary Order 1985.

Mr. Peter Shore: The House will be grateful to the Lord Privy Seal for making a statement to the House on the Lord Chancellor's salary order for which, in marked contrast to the Prime Minister's written reply on top salaries generally last night, time has been found for debate next week. I have only one question. Is the 16·7 per cent. increase to £77,000 per annum in the Lord Chancellor's salary due to the fear that the present incumbent will be tempted to leave his post for more lucrative offers, or is it due to the inability to attract suitable candidates from other Government levels to take his place?

Mr. Biffen: The right hon. Gentleman's question is of such seriousness and substance that it requires a debate rather than a mere question and answer session across the Table. Parliament is being invited to consider the measure because it needs parliamentary approval.

Mr. Jonathan Sayeed: May I say how pleased I am that we are to have a debate on Tuesday, because it will allow Government Back-Benchers to say that, although we understand the reasons for accepting the Top Salary Review Body recommendations, we believe that the timing is inept and that the Government are not demonstrating that the burden of moderate salary increases should be shared by everyone?

Mr. Biffen: I thank my hon. Friend for giving me advance notice that we shall experience a lively 90 minutes on Tuesday.

Mr. Jack Straw: Since the Leader of the House is infinitely more sensitive to feelings in the country and the House than the Chief Secretary, who has fled the Chamber, may I ask him whether he appreciates the genuine sense of moral outrage caused by a salary system over which the Government preside that allows people such as the Lord Chancellor to be paid more than £40 per hour—more than some adult workers are paid per. week? The Government have forced people to accept such low wage levels.

Mr. Biffen: That is a good populist point, but not in the context of moral outrage.

Mr. Patrick Thompson: Will my right hon. Friend accept my thanks and congratulations on providing the opportunity to debate the Lord Chancellor's salary increase—and perhaps others—next week? Does he accept that there is deep concern about the issues discussed this morning on both sides of the House, because such rises go against the need to control public expenditure and are a poor example to those of us who are trying to persuade prison officers, the police and teachers to accept sensible and moderate pay awards? Secondly, does he agree that such rises do not set the example that leaders have set before and which the Prime Minister is at present


setting? Does my right hon. Friend accept that there is concern and will he further accept that I welcome the opportunity to discuss the issues next week?

Mr. Biffen: I appreciate what my hon. Friend says. He will realise that the change of business covers a relatively narrow issue in relation to the Lord Chancellor. He is right to imply that the wider issues can feature in the Consolidated Fund debate.

Several Hon. Members: rose——

Mr. Speaker: Some Opposition Members wishing to ask a question were called earlier so if I call them now they must confine their remarks to the Lord Chancellor's salary order.

Mr. Dennis Skinner: I wonder whether I can help to sort the matter out. Earlier we were told that one of the reasons why the top people, including the Lord Chancellor, need a pay increase is to keep them in their jobs. Perhaps I have not listened to everything that has been said, but I have not heard that the Lord Chancellor is threatening to pack in his job because he cannot get a proper pay rise. We were under the impression that the Lord Chancellor is being kept in his job because the Government are frightened to face a by-election if they have to put somebody else in his job. If that is so are not the Government lining the Lord Chancellor's pockets to save themselves from a by-election which would prove to be another disaster for the Minister?

Mr. Biffen: I understood from the hon. Gentleman's preamble that his comments were by way of assistance. I shall have to reflect considerably before I embrace that assistance.

Dr. Michael Clark: When we decide whether to increase the Lord Chancellor's salary next week will it be on the basis that his morale is low, that he is in danger of leaving his post or that we are not paying him enough compared with what he might receive outside?

Mr. Biffen: I shall be happy to give my considered reflections on those direct questions in the debate. In the meantime, I shall have time to acquaint the Lord Chancellor with my hon. Friend's comment so that he can give me some advice.

Mr. Dave Nellist: How does the Lord Chancellor's rise square with the Government's assertion that people cannot have wage rises because they price themselves out of jobs? How can a rise of thousands of pounds for the Lord Chancellor be squared with that principle when youngsters who are earning £29·70 a week are not even allowed a few pence extra?

Mr. Biffen: Earlier, the hon. Gentleman said something from a sedentary position about corporals being paid the same as field marshals. The hon. Gentleman is quiet about that now. In any society, particularly in relation to public office, differentials are accepted and certain premiums are paid for responsibilities. We must face up to the challenge implicit in the Top Salaries Review Body report. We cannot run away from them.

Mr. Michael Stern: While I welcome my right hon. Friend's statement may I ask hire to ensure that when we debate the motion on the Lord Chancellor's salary our attention is drawn to the fact that the politics of jealousy, which has given rise to the squeals from the Opposition today, went out with the 1970s? Will he confirm that the majority of people will welcome the rise for the Lord Chancellor and others on the ground that it creates opportunities for their children?

Mr. Biffen: I am not sure whether the debate on Tuesday will resolve that issue, but I agree that orchestrated envy has been endemic in politics from the beginning.

Mr. William McKelvey: Will the Leader of the House reflect on what he said about differentials? Many groups of workers have fallen out of the pecking order scale. Does the Leader of the House accept that the Government should consider what has been said today because they seem to fail to understand that, when ordinary people read in the paper about these great increases for some sections of the community, when skilled engineers, for instance, whose differentials have been eroded——

Mr. Speaker: Order. I remind the hon. Gentleman that the business statement is about the Lord Chancellor's salary.

Mr. McKelvey: I was talking about the proposed increase in the Lord Chancellor's salary. I think that on reflection the House might refuse to grant that increase.

Mr. Biffen: This matter can be resolved on Tuesday night. I wonder whether the orchestrated indignation we now hear was evident at all when hon. Members read the written answer on 4 July 1978 which stated:
The increases now recommended by the Review Body over salaries currently in payment are on average 35 per cent."—[Official Report, 4 July 1978; Vol. 953 c. 98.]

Several Hon. Members: rose——

Mr. Speaker: Order. We must move on.

Gas (Northern Ireland)

The Minister of State, Northern Ireland Office (Dr. Rhodes Boyson): I beg to move,
That the draft Gas (Northern Ireland) Order 1985, which was laid before this House on 11th July, be approved.
Those who have had to consider this topic in recent months are well aware that the future of the Northern Ireland gas industry has given rise to argument and debate in the Province for many years. Hon. Members may feel that those arguments should be rehearsed again today, but I ask that we do not lose sight of the simple fact that the instrument that is now before the House is made necessary by the fact that only one of Northern Ireland's gas undertakings—and that in private hands, the Portadown undertaking—considers it can continue in business without Government subsidy. This subsidy has rapidly increased from £2 million a year between 1974 and 1980 to £10 million a year between 1980 and 1984, and today it stands at £12 million.
Listening to recent criticism of the draft order, the disinterested layman could be forgiven for assuming that it expressly commanded the closure of the Province's gas industry, overriding the wishes of all those involved in it who wanted to maintain it. That is not the case. In every instance, the decision to close was taken by the gas undertaker alone and was based on a recognition that remaining in operation was not a commercially sensible proposition.
The Government simply said that increasing the subsidy more and more, in the manner of the economics of Passchendaele, would have to come to an end. Once closure decisions were taken, the order became essential, first, to relieve such undertakers of their statutory obligation to supply, and, secondly, to allow the Government to fund an orderly and planned rundown of each undertakings operations.

Mr. Dave Nellist: The Minister referred to an increase in subsidy from £2 million to £12 million—a £10 million increase. He will no doubt point out in due course that the number of workers affected by the order in the gas industry totals at least 1,000 in Belfast and several hundreds elsewhere.
Does he not find it slightly ironic that he should be making such remarks only minutes after one of his colleagues in the Cabinet said that the Government could afford £9 million to increase the salaries of fewer than 2,000 people in the judiciary, the Civil Service and the armed forces? He is now saying that they cannot afford a a similar sum to secure for a further year the equivalent number of jobs in Northern Ireland.

Dr. Boyson: I thought that we had finished with that issue and were now dealing with the draft order. I appreciate the hon. Gentleman's feelings on the subject and I do not minimise them. Today, however, we must look coldly at the gas industry, and later in my remarks I shall deal with the question of jobs.
It is not simply a question of losing jobs in one industry. By employing coal—it and liquid petroleum already account for 50 per cent. of central heating installations in Northern Ireland—it is hoped, because of the number of people involved in distribution and so on, that there will be more jobs than there are at present. I am sure that the hon. Gentleman will join me in expressing that hope.
I have a responsibility to see that the £4 billion available to Northern Ireland is spent to the advantage of the people, and no hon. Member will disagree with me in saying that. We are prepared, as we are already doing, to put money into transferring one generating station over to coal. We believe that to do so is more economic and will save money for the Province because it will make it cheaper to generate electricity. We are also prepared to put money into lignite and to take other financial steps which, in the long run, will be to the advantage of the mass of the population of Northern Ireland. I am therefore grateful to the hon. Member for Coventry, South-East (Mr. Nellist) for intervening, because he has given me an opportunity to state the position.
For the benefit of hon. Members who may be unfamiliar with the problems of the gas industry' of the Province, I should point out that in the last 10 years Governments of both complexions—this can be demonstrated by many quotations from many debates—have sought to tackle the industry's fundamental problem of soaring costs due to its oil-based feedstock and the additional difficulties caused by its fragmented and declining structure.
In May 1976, our predecessors in office—a Labour Government—commissioned the Britsh Gas Corporation to determine the scope for resolving those problems, and the then Minister of State, the right hon. Member for Mansfield (Mr. Concannon), for whom we have a high regard, quoted the corporation's report when he said:
As a whole, the industry has a poor image in the view of its customers and is becoming increasingly uncompetitive with other fuels."—[Official Report, Northern Ireland Committee, 6 July 1977; c. 2.]
That was eight years ago.
In its report, the British Gas Corporation—I have that report with me and I am sure that other hon. Members have studied it—looked at all possibilities offering the prospect of viability. Among the options considered was the possibility of a gas pipeline from Great Britain. On the basis of the corporation's report, the Government concluded that, as with a number of areas on the British mainland covering at least 15 per cent. of households, a direct pipeline was not an economic proposition. That remains the position today.
I remind the House that 15 per cent. of households in Great Britain are not on natural gas, although most of them would like to be. That is because they are not within 25 yards of a main pipeline, or—I say' this from memory—they are not using more than 25,000 therms over a given period. It was accepted in 1975 that undertakings would at some stage be obliged to close unless further demand was placed on the industry.

Mr. Nellist: Does the Minister mean 25 miles rather than 25 yards?

Dr. Boyson: So far as I know, it is 25 yards, but I am always open to correction. On this occasion, speaking in a gas mantle position, I believe that I am right.
Hope for the industry was rekindled, however, when in 1980 the prospect of a natural gas supply from the Republic of Ireland became a possibility. It was an option which we pursued for the industry with determination, and in October 1983 agreement in principle on a supply of gas from the Kinsale field to Northern Ireland was reached between the British and Irish Governments.
Following the signing of the agreement in October 1983, but preceding the conclusion of a contract for supply


—it was only a memorandum of understanding—two critical developments took place which utterly changed the Kinsale project's prospect of viability. First, the long-term trend in heavy fuel oil prices, which was the integral component in determining the purchase price of Kinsale gas, was reassessed. Expert advice on fuel oil prices was that, over the long term, prices would remain much higher than had been anticipated. Heavy fuel oil prices are, of course, subject to large short-term fluctuations, but these are allowed for in our assessment of the long-term forecast.
The price has come down. At Christmas 1984 it was much higher than when the decision was made in the previous September by my predecessor. In March this year it was the same as it was then. It has since dropped. I have a graph showing the price increases in heavy fuel oil, and it shows tremendous increases in recent years. The graph showing the situation from 1976—I shall be glad to circulate it to any hon. Members who are interested—shows the increase to have continued well beyond the rate of inflation.

Mr. Peter Archer: I understood the Minister to say that after October 1983 the Government took expert advice about the trends in heavy fuel oil prices. Is he saying that they did not take expert advice before they signed the memorandum of agreement?

Dr. Boyson: The Government take advice all the time. Indeed, one can suffer from the amount of advice that is received.

Mr. Archer: Now answer my question.

Dr. Boyson: I shall answer the right hon. and learned Gentleman, but he must be patient. He knows as well as I do that we get nothing but advice all the time. Ministers have the task of sorting out which advice is valid and which is invalid in the context of the matters with which they are dealing. My answer, therefore, is that the Government did take advice. I grant that the Labour party, when in office, did the same. Advice is continually coming in. It became more and more apparent that in the long term the cost of heavy fuel oil was more likely to increase than decrease. There was a secondary factor, however, which led us to consider what the fuel oil price would be—the fact that demand for gas in Northern Ireland was collapsing or, at any rate, was falling at a rate that was not expected.
We commissioned a very detailed study from Deloitte, Haskins and Sells to help plan the natural gas network at that time. I have the report here. Even allowing for a wide margin of error, the report of those studies presented an estimated total demand for gas about one third less than the previous forecast produced by Coopers and Lybrand in 1983. In one year the fall in the demand for gas was such that there would have been only two thirds of that demand by the time the pipelines had been laid and natural gas provided to the Province.
Further discussions with the Irish Government failed to secure agreement on a revised price, and evidence from other sources confirmed our amended forecast of demand. In an attempt to resolve the problem, we examined various adjustments to the project, such as reduced area of supply, but none of those proved viable.
We were faced with the stark alternatives of proceeding with an uneconomic project, which would continue to

make heavy calls on Northern Ireland's limited public expenditure resources, or withdrawing from it entirely. The decision to abandon the enterprise was unpalatable, unpopular and regrettable in many ways, but I believe that any responsible and honest Government would have made that decision on the information then available. The information is basically the same today as it was when my predecessor made his decision at the beginning of September last year.
The Kinsale project had appeared to offer the industry's only prospect of a secure future. In reaching the conclusion that it was not a commercially viable proposition, the Government reaffirmed the cecision taken in July 1979 that there could be no more subsidy for gas undertakings in the absence of any hope of their attaining viability. The Government had been moving towards that decision for about five years previously, and they made it perfectly clear in September last year.
The decision was not taken lightly. It was grounded in a recognition that we could not afford to spend £12 million a year—and it is self-increasing—on something which would contribute only 2 per cent. of Northern Ireland's energy supply. I repeat that 98 per cent. of the energy of Northern Ireland comes from other sources. Indeed, if all the energy of the Province were to be subsidised at the same rate, it would cost £600 million in subsidy—between one sixth and one seventh of the whole of the Northern Ireland block.
The subsidy represents £120 per consumer every year, or '70p for every therm of gas sold. Last year, even with that level of support, the Belfast undertaking alone lost about 10,000 customers, or one in seven. Subsidy of that order must, of course, come out of Northern Ireland's overall allocation. What we spend on a declining gas industry has to be offset by savings in some other area of public expenditure in the Province—for example, health or education.
In announcing the withdrawal of subsidy, my predecessor, my right hon. Friend the Member for Bosworth (Mr. Butler), invited representations about the future of the gas industry in Northern Ireland from the various interests involved. The Government were prepared to consider seriously any option proposed, on the sole condition that it offered the firm prospect of a viable industry without the continuation of an indefinite subsidy towards the price of gas. That was then the bottom line, and it was again the bottom line in a similar statement that I made in April this year.
In response, a joint working group from the industry announced that it was developing a revised Kinsale gas scheme which it proposed to offer as an alternative to the abandoned project. It has been alleged that we were not disposed to examine that proposal fairly. The reality, of course, is that we allowed the accumulation of another six months of deficit support, at £ t million per month, while the joint working group's scheme took shape. We said, "You can do it, but you must convince us that it will be viable without Government subsidy." When the scheme was finally produced, it was subjected to a thorough appraisal. That appraisal found the scheme to be seriously flawed, for reasons to which I shall come later.
Some hon. Members have suggested that we deliberately avoided conveying our reservations to the scheme's sponsors who, we are told, were "shattered" when I made my announcement to them on Good Friday. Incidentally, Good Friday is a working day in Northern


Ireland. We are talking about the Northern Ireland gas industry, not the one in Great Britain, and hon. Members should understand that. I told the sponsors that the Government could not accept their rescue plan for the industry.
The suggestion from hon. Members rather ignores the appraisal process which actually took place. The rescue plan was analysed by the Department's advisers, who then expressed their reservations in person and in detail to the consultants employed by the joint working group. Between five and nine meetings were held, and I have been provided with the dates. The reservations were severe and centred on the methods of analysis which has been used and the demand projections therby produced. Accordingly, the consultants were urged to inform their clients. Against that background, hon. Members will find it less than convincing to be told that the Government's rejection of their plan came as a total shock to the sponsors.
Our appraisal of the rescue plan uncovered a number of major difficulties, but fundamental to the reasons for its rejection was its failure to address that problem of a gas purchase price linked to heavy fuel oil and its dependence on gas capturing a huge share of the market at a high price relative to other fuels that could be bought.
It is generally implied by our opponents that some sort of accommodation on price could have been reached with the Republic of Ireland Government. That suggestion is based on nothing more than wishful thinking, as is hown by an examination of the evidence point by point.
Speaking in the Irish Parliament on 11 June, the Republic's Minister for Energy said:
Deputy Reynolds and myself were in accord with our decision not to reduce our price to the British and there has not been a change in that case.
Further comments from Mr. Spring, as reported on 10 July in the Irish Times, regarding the Republic's policy on gas prices in general, show that there has been no change in its approach. That, of course, is the prerogative of the Irish Government, and I respect their judgment, as they will respect our determination not to become locked into a project which is not viable for Northern Ireland.

Mr. Archer: Did the United Kingdom Government ever invite the Irish Government to reconsider that matter?

Dr. Boyson: Conversations on price were held, and they ended when the Irish Government were not prepared to compromise on it. Conversations have not been held since then because there is no sign that the Irish Government have changed their mind.
Last September we made a decision on the information that we had, when there was no suggestion that there would be a lowering of the price, and that decision still stands. We gave them six months in which to produce a viable scheme. We do not believe that it can be a viable scheme. Private enterprise obviously does not believe that it is a viable scheme; otherwise it would back it. The corporations presumably do not believe that it is a viable scheme, or they would back it with their money. Everybody comes to us to provide the money and the guarantees. We are always regarded as the banker of last resort.

Mr. Roy Beggs: Is the Minister suggesting that a price was offered to our Government on

a take-it-or-leave-it basis? Is the Minister aware that the negotiations were taking place with the greatest horse traders in the world, who would have been offering gas at the highest possible price that they could obtain for it but who would possibly have accepted a much lower price?

Dr. Boyson: The hon Member has raised an important point. Conversations continued until September last year, when a decision was taken that, unless we could be shown that the scheme was viable, the talks would end. We were prepared to be proved wrong by somebody showing that it could be done more economically. Conversations have not been held since then because it was clear that the price we were then offered was linked with the price of heavy fuel oil. That meant that it was no cheaper than taking heavy fuel oil.
In April this year we said that we were not convinced of the viability of the scheme, and I am even less convinced now. It is the economics of "Alice in Wonderland" to believe that the scheme that was put to us is viable. It came from interests and workers in the gas industry who were not putting in their own money. I am not attacking them for that, but they were not having to cover the money. The bill would have been left with the Government. The more we spend in that direction, the less we can spend in areas where we know we can save money for the Province. We can help with the energy price of electricity and lignite. We cannot spend a pound twice.

Mr. Harold McCusker: How can the Minister describe as "Alice in Wonderland" the proposals which Coopers and Lybrand and the consultancy report justify in economic and financial terms? How can he use that term to describe the work of those two bodies?

Dr. Boyson: Politicians on each side of the House are elected to make decisions on the information that is put to them. That is why we are here. I have considersble respect for the hon Gentleman. I do not know how one can increase sales at a price that is between 30 and 50 per cent. more than coal. That would mean gas taking 50 per cent. of the central heating market compared with its present 3 per cent. share of the market. I think that no one outside the House would believe that either.

Mr. McCusker: What about Coopers and Lybrand?

Dr. Boyson: The hon. Gentleman should ask Coopers and Lybrand, not me. We have made the decision. I am answering the hon. Gentleman perfectly frankly; I am not running away from the question. It was an honest question and the hon. Gentleman is getting an honest reply. I appreciate that there are strong feelings inside and outside the House about the matter. That is why I am putting my case so firmly and strongly.
I shall now spell out in more detail what I was saying about demand in my quick and no doubt correct reply, because I have now lived with the gas industry for about eight or nine months, day by day and step by step.
On demand, the rescue plan requires that gas should capture a tenfold increase in sales at a price which, at the minimum, is about 30 per cent. above the price of coal. For example, that would mean gas taking 50 per cent. of an enlarged central heating market in contrast with its 3 per cent. share of today's market. The plan's supporters have endeavoured to deflect their arguments with calls for the release of the Government's internal market studies, but the fact remains that the scheme requires us to accept


an estimate for demand that is 50 per cent. higher than any other source has ever estimated. Every time we have had a report, the figures have been different. Presumably the only reason why reports can be sold is that the results are different every time. However, after reading the reports one has to make a decision on their validity.
Any person in my positiion or that of my predecessor could see that demand was falling faster than had been expected. That was the logic of the argument that was put to us at the time.

Mr. Beggs: Does the Minister accept that when there was no confidence about future supply at reasonable prices and continuing discussion and publicity in relation to the possible closure of the gas industry, it was perfectly normal for people not to choose to use or depend on gas?

Dr. Boyson: I entirely agree with the hon. Gentleman. People were getting out of gas so fast that they literally would have had to be won back to the possibility of natural gas. That is one point about the amended plan. It would have been a long time before natural gas was introduced. People thought that it was a dying industry—it it was already dying on its feet. Therefore, they decided not to use gas. They were making a judgment that we eventually had to make. With the information that they received, those people preferred other fuels.

Mr. Archer: I think that the Minister has missed the point made by the hon. Member for Antrim, East (Mr. Beggs). There is no point in saying that earlier surveys gave a different result about market prospects if at earlier stages prospective candidates for the market had not been offered gas on those conditions and at those prices.

Dr. Boyson: One of the attributes of most politicians is the misunderstanding of a question. In this case, however, I tried to understand the question. We assessed demand as it was at the time, and it was less than before. The right hon. and learned Member is right. The hope of natural gas being introduced in three or four years with the new pipeline and resulting in increased demand, is not one that I share. That is not something that I can prove or disprove. The decision was made on the balance of the facts, and the facts all pointed the same way.
I was trying to spell out all the paraphernalia and information that we were given before we reached our decision. I do not propose to go into all the other doubts that emerged. I mentioned them in the Northern Ireland Committee. Those doubts emerged from our examination regarding the plan's under-estimates of capital cost and optimistic assumptions of productivity. The plan's sponsors know what those doubts are and that, sadly, we find them persuasive. In brief, an investment analysis of the plan's costs and returns showed a large cumulative deficit over the 20-year period of supply. The bottom line was that we were not convinced that that was viable. We thought that it would be a running sore in the finances of the Province.
Notwithstanding the plan's non-viability, the Government were encouraged to invest no more than £4 million to allow its implemention, and that was contrasted with the much greater sums required to assist the industry's closure. That argument is bogus. It assumes that substantial funding would be available from the European Community, but ignores the problem of additionality and the fundamental requirement that projects needing EC assistance must be viable in their own right.
Similarly, the Government are accused of unfairness for daring to include the element of the guarantee that they are required to give in calculating the overall cost of the plan. It is elementary common sense to anticipate the £70 million cost of those guarantees to the taxpayer, as we would have to meet them fully if the scheme did not succceed. We did not expect it to succeed at the time. An individual would not take on a guarantee for anybody without realising that it might be called in. It is real money when it is called in.
It is not a question of spending £4 million or £70 million to keep the industry going, compared with £97 million to close it. We do not believe that the £4 million or the £70 million, would keep it going. We would have to spend £4 million, then £70 million, and then the £97 million in addition. As far as we are concerned, that is pouring good money after bad.
At this stage I wish to allude briefly to several points that were raised during the Northern Ireland Committee debate, which I believe require some comment. First, concern was expressed that a wider European gas network is being planned which would link the gas system in the Republic of Ireland to that of Great Britain. I assure hon. Members that, as far as we know, no such link is envisaged at present. There has been talk about the gas industry for so long, but no concrete plan is on the table. The Government will, of course, regularly review the scope for wider interconnections of various European gas systems, but in order for such projects to be realised they must be economically viable and fulfil a commercial need.
Hon. Members may have seen speculation this week about private sector interest in the funding of new gas supply arrangements in the Province. I applaud every attempt to enhance the role of private capital in the Province's industry, and the gas industry is no exception. Obviously, the Government would not prevent private investment in any plan to revive the existing undertaking or to set up a new gas industry as long as genuine private investment was involved without recourse to Government guarantees and protection. The Government cannot invest taxpayers' money in a project in which we no longer have confidence. If such people want to put their money in, we would not stop them, but it is no good their coming to us for bottom line guarantees.
Of all the issues raised regarding the abandonment of the Kinsale project and the subsequent rejection of the rescue plan proposals, none is more important than job losses arising from closure decisions by undertakings. No one on either side of the House has a monopoly of concern on that matter. I regarded the impact on jobs as the prime reason for affording the rescue plan the extra six to eight months to see whether it could bring forward a viable scheme. However, simply wishing to preserve jobs is not a feasible basis for the success of any industry.
In recent years, the desire to maintain employment in the Province's gas undertakings has persuaded Governments of both colours to provide ever-increasing subsidies only to see the industry's decline continue relentlessly. Also, as I stressed in the Northern Ireland Committee debate, the jobs factor is not a simple issue. Closure would mean the loss of 1,000 jobs. One recognises that, and nobody is satisfied about it. The April plan would save 400 jobs. Those jobs could be saved only if trade was taken away from coal or other energy resources, all of which are labour-intensive industries.
As I have said, time will tell, but I should not be surprised if the increased use of solid fuel and liquid petroleum gas, both of which are labour-intensive in distribution, results in at least as many, if not more, jobs in the long run. The Government will attempt to minimise hardship by underwriting payment of redundancy terms up to those agreed in the British Gas Corporation. In addition. certain employees participating in the local government superannuation scheme will be eligible for early retirement benefit. Incidentally, Kilroot power station, when converted to solid fuel, will at its peak employ 500 people. It will also employ more people than before inside the generating station.
All but one of the Province's gas undertakings have decided to close and a number have expressed their wish to do so without delay. However, 10 of the 12 undertakings opting for closure have statutory obligations to supply, the removal of which is not provided for in any existing legislation. I have already made it clear to the House that every month of subsidy costs the taxpayer another £1 million. For that reason, I consider it essential to provide those undertakings which wish to close quickly with the legal authority to do so as soon as possible. Following consideration of the points raised in Committee, I concluded that we should lay the draft order before the House without delay.
Those hon. Members who attended the Northern Ireland Committee debate on the order will be aware that I said on that occasion that, following representations made during the consultation period on the order, I was examining the possibility of removing certain provisions contained in the published proposal. That examination, with information from Belfast power station and elsewhere, persuaded me that the deletion of those provisions would not affect the orderly rundown of any gas undertaking wishing to close or the effective control of public expenditure on assistance during closure. Accordingly, the draft order reflects those amendments. Those hon. Members requiring notification of such changes have been duly informed by me in correspondence.
I propose now to refer briefly to the provisions of the order. Articles 1 and 2 are the customary clauses relating to the title and interpretation. I do not think that anyone can argue about those.
Article 3 permits gas undertakers in Northern Ireland to enter into a voluntary agreement with the Department to facilitate their rundown process when closure decisions have been taken.
Article 4 removes from such undertakers statutory and contractual obligations to supply.
Article 5 is a reserve power of direction providing the Department of Economic Development with power to direct aspects of the rundown process where this is considered essential.
Article 6 provides the Government with authority to offer direct financial support to undertakers allowing them to continue to operate while an orderly rundown is in progress. Support is also necessary to help undertakings to meet the various costs associated with actual closure, including the discharging of outstanding financial liabilities.
Article 7 establishes incidental legal provisions regarding rundown and provides for the legal wind-up of undertakings following closure.
Article 8 enables the development of a gas conversion assistance scheme. Since the proposal for the draft order was published, I have been able to announce details of the scheme. I shall not go through them now as they are public knowledge.
Article 9 requires that gas consumers be given notice of any action arising from the order which will affect them.
Article 10 provides for the repeal of redundant provisions in related legislation.
Through the mechanism of the order, the Government propose to take the initial steps in the provision of substantial public funds to permit the orderly rundown and closure of those gas undertakings which opt for that course of action. In so doing we are attempting to ensure that the closure process in every case will cause minimum harship to consumers and employees alike. I remind the House that the provision of such support is not a legal obligation on the Government. It is not a nationalised industry, and they are not Government gas undertakings.
It would have been simple, and certainly much less costly, to inform the owners of the undertakings—private or local authority—that the Government had no further role to play in financing closure costs. We should be legally within our obligations simply to turn off the tap, because they are not nationalised undertakings. We have not done that, because we were concerned that there should be an orderly rundown. We were also concerned for the employees, and especially for the customers. The thousands of consumers who have already converted to other fuels have done so at their own expense. The only ones needing to be paid for are those who remain. In fact, meeting the clean air legislation was far more costly for individuals than the closure of the gas industry will be. I offer that comment in passing, for my own satisfaction and perhaps for yours, Mr. Deputy Speaker.
It is sad, but not entirely surprising, that some of those who failed to demonstrate the financial logic of their own proposals for the industry should then proceed to disparage the Government's estimate of the cost of closure support. I do not say that every figure is absolutely correct, but we have taken advice from British Gas, and the figures that we have given are our best estimate of what rundown and disconnection will cost.
I find particularly objectionable the attempts of some of our opponents—by this I do not mean anyone in the House—to distort and play down the extent of assistance available under the gas conversion assistance scheme. Such tactics merely alarm gas consumers, many of whom are elderly and in no position to verify the facts.
I have also sought advice on another important factor—the effect on the consumer not just of the disconnection of appliances but of the cost of alternative fuels. I have some interesting figures, which I will circulate if hon. Members wish, suggesting that the running costs will in every case be lower than they would be if the existing gas supply system were continued. With coal, the same amount of heat costs half the price. In other words, many people should be warmer after conversion. Other factors, such as safety, are equally important.
The scope of the order is intentionally wide so that we can react to problems as they arise. In life, the problems that one expects never happen, but the ones that one does


not expect become matters of great concern. That has been my experience, at any rate. I believe, therefore, that it is right to cast the provisions in broad terms.
A question was asked about the appeals system. There is nothing in the order to prevent the introduction of an appeals system. We realise that there is concern about the handicapped and that they must be provided for. The draft order is open for discussion. If it is felt that something ought to be done. the order is drafted in such a way as to allow that to happen. It is not drafted in a narrow way. I have already given an undertaking to consider the feasibility of an appeals system. We are examining how this can be introduced without crippling the rundown while being fair to customers.

Mr. Archer: If this were primary legislation applicable to any other part of the United Kingdom, these matters could be considered in Committee and amendments introduced on Report. The hon. Gentleman is asking the House to give him a blank cheque, with no guarantees attached to it.

Dr. Boyson: The constitution of Northern Ireland is a matter of continuing concern. I do not intend to put forward views on the future constitution of Northern Ireland, even if I had them, or even if I should be influential in putting forward those views. All I can say is that legislation is dealt with in a different way in Northern Ireland.
There is sadness in Northern Ireland that many of the Province's gas undertakings have reached the end. But that sadness is combined with a widespread realism that closure of those undertakings is simply the long-delayed outcome of a commercially untenable position. In a few quarters, that realism is abandoned in favour of an apparently obligatory denunciation of Government's failure to work miracles, accompanied by a ritual demand for increased public subsidies. But continually to shore up gas undertakings in an effort to insulate them against commercial realities is to fly in the face of a positive energy strategy for the Province. That strategy is now taking shape with coal generation of electricity replacing oil, while, in the longer term, the development of lignite offers our best hope of reasonable energy prices.
In the meantime, it is incumbent on us to accept that where gas undertakings are unable to survive without subsidy they should be allowed to close in a planned and orderly manner. The draft order seeks to facilitate that process. I commend it to the House.

Mr. Peter Archer: The speeches of the Minister of State, Northern Ireland Office, are always characterised by courtesy and good humour, but we must not allow that to conceal what is happening. We are playing out what the Government no doubt hope will be the final chapter in this sorry story of doctrinaire intransigence, of arrogance in office, of the closed ear and the closed mind and of complete contempt for the procedures of the House. It is the logical and perhaps inevitable product of a Government led by a Prime Minister who boasts that she is not for turning and of a Government who dismiss moderation as "wet".
Let me remind the House of the principal chapter headings in the story. Prior to the autumn of 1984, the people of Northern Ireland believed that natural gas would

be available to them as one of the options for household fuel and industrial energy. It was to be provided from the Kinsale field pursuant to a memorandum of agreement, of which the Minister of State has just reminded us, that was entered into by the two Governments in October 1983.
On 6 September 1984, the then Minister of State, Northern Ireland Office, announced that the United Kingdom Government were not proposing to implement the agreement. For reasons which have already been explained and which we explored in Committee on 26 June, the Government did not believe that gas could be provided without a subsidy. As the Minister of State has again explained so clearly, the Government applied to this matter their general philosophy that any human activity which does not show a financial profit is not worth doing. So the Minister of State said that the Government would not continue to provide a subsidy and that this would have obvious implications for the future of the gas industry and for those whose jobs are dependent upon it. But he must have realised that the gas industry could not, with any pretensions to democracy or to fairness, be killed off without the opportunity for consultation, so he said that the Government would be glad to receive representations about the future of the industry from the various interests involved. The gas industry took the Government at their word and established a joint working group representing employers and trade unions. Each side was keen to do whatever was necessary to serve the industry.
The group produced a report setting out a scheme that was, admittedly, more modest than the original project. In the first phase it would have made gas available to Belfast and Newry, with the prospect of a wider market later. It would not have saved all the 1,000 jobs that were to be lost in the gas industry, but it would have saved 400, with a prospect of more jobs at a later stage. It offered 90 per cent. of the market envisaged in the original plan, at rather less than half the cost. It would have required some initial financial outlay by the Government, but over 20 years it would have shown a surplus of £159 million. So it met the Government's declared objective of ending the subsidy.
The plan was submitted to two firms of consultants of the highest repute and they endorsed the assumptions, the calculations and the conclusions of the report. The hon. Member for Upper Bann (Mr. McCusker) posed in Committee the reasonable question, "If Coopers and Lybrand is wholly reliable when it produces reports for the Government, what character change does it undergo when it produces reports for the gas industry?" The hon. Gentleman repeated that question today and again received no reply. The Government lose their enthusiasm for the work of Coopers and Lybrand when it produces a report for anyone else, and declare its reports to be Alice-inWonderland efforts.
The industry submitted the report to the Minister of State. It did not assume that he would necessarily accept the report in its totality and without question. It envisaged that he might wish to meet the working group and ask questions to test its conclusions and to explore further some parts of the plan. The industry did not envisage that the Minister would simply delegate to a few officials the task of meeting a few members of the working group, arid leave it at that. When the Minister invited members of the working group to meet him on Good Friday, they attended prepared to embark on the sort of discussion which is the life blood of consultation and, indeed, of the whole democratic process.
Despite what the Minister had said, members of the working group were amazed when he told them that there was nothing to discuss and that he had decided to reject the report without any discussion or any opportunity for further consultation.
As the hon. Member for Antrim, East (Mr. Beggs) pointed out in Committee, there were those who suspected that, no matter how persuasive the report, how careful the research and how compelling the conclusions, the Government's mind was already closed because the decision had already been taken beyond the possibility of further consideration.
The Minister has assured the House that the Government meant what they said when they invited consultation in October 1983. But it is hardly surprising that people have been led to ask why, if the Minister was not prepared even to discuss these matters with the working group, the Government invited representations. Why encourage the industry to take the trouble and expense of sponsoring a careful and well-researched report?
That question occurred to more people when the Minister of State, in giving evidence to the Assembly, said:
In any case, the decision was not made now. As I have said clearly, it was made on 6 September.
So the book had been closed before the industry even dipped its pen in the ink. It was all a charade.
The working group was not the only recipient of such cavalier treatment. The Minister has confirmed that the announcement was made on Good Friday, the day after the House had risen for the Easter recess. It was a working day in Northern Ireland, but not for the House. On the previous day Northern Ireland Ministers were answering questions in the House, and hon. Members representing Northern Ireland constituencies were in the Chamber. If the House could not have been informed of the decision in answer to a question, there was no reason why a statement should not have been made. Not one word was breathed about the Government's intention until the next day—after the House had risen. The Northern Ireland Assembly received similar treatment. It was deprived of an opportunity to express a view because it was no longer sitting.
Some of us made representations to the Government. I wrote to the Secretary of State asking him to receive a deputation from the industry as the closure of an entire industry was a matter that merited the decision of the Secretary of State. He replied:
I do not see that a meeting with the Working Group to go over this ground would serve any useful purpose".
In fairness, when I invited the Minister to convene the Northern Ireland Committee to discuss the matter, he agreed to do so and brought the proposed draft order before that Committee. I assumed, as no doubt did the other members of the Committee, that he genuinely wished to hear the views of right hon. and hon. Members. He heard them. After the Minister spoke, there were eight contributions, each of which was critical of the Government's proposals, each of which asked questions that demanded answers and each of which begged the Government to think again. At the end of the debate, 

18 votes to 10. Every party represented on that Committee, with the exception of the Conservatives, voted in the negative.

the Committee divided and the Government were defeated by

Mr. John Hume: And spoke.

Mr. Archer: As the hon. Gentleman says, every party was represented among those who spoke.

Mr. Hume: Except the Conservatives.

Mr. Archer: Yes, and the Social Democratic party. If the Minister wanted to know the views of the Committee. he had them as clearly as they could be expressed. The Committee opposed the closure of the gas industry. My hon. Friend the Member for Bow and Poplar (Mr. Mikardo) said that those who attended the Committee had other calls on their time to which they might well have responded if they had believed that the Committee was simply an academic exercise and had no prospect of influencing events.
The Government proceeded as though the Committee had never existed. The Minister was kind enough to write to some of us a few days ago saying that the Government proposed to delete two proposals from the draft order. Those deletions were in the Government's mind before the Committee sat—the Minister referred to them in his original speech in Committee. Nothing said in Committee induced any change in the Government's plans. Indeed, the Lord President said the following day, 27 June, in reply to a question asked by my right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley) that the decision of the Committee was
a technical vote which has no significance".—[Official Report, 27 June 1985; Vol. 81, c. 1079.]
It was not technical at all. It was a considered opinion of the Committee on the merits of the argument. The Government's behaviour simply reinforces what I have already said. To members of the Government, the vote of a Committee of the House has no significance. So much in 1985 for the mother of Parliaments and the descendants of Pym and Hampden.
Lest anybody might have been so misguided as to have contemplated for a moment, in the face of all of that evidence, that the Government could consider it possible that they may be wrong and that, within those holes in the sand, ministerial heads were equipped with ears to hear, on 5 July, the Minister of State issued a statement reiterating that the Government had no plans to reopen examination of the project.
We might have thought that, in those circumstances, the Government would at least have retained sensitivity enough to pretend that they were treating seriously all the representations, the questions, the expressions of opinion and the pleas to think again. But for the present system by which Northern Ireland is governed, a step of such importance would have required primary legislation, with days in Committee and on Report. We might have thought that the Government would at least have accorded the matter a day's debate when hon Members could arrange to attend and make their views known. We might have expected that at least, as a cosmetic exercise, but the Government do not consider it necessary even to go through the motions of taking it seriously. They introduce this business on a Friday late in July when, as they must have known, hon Members are under pressure to be in their constituencies. Such is the importance that they attach to the closure of a complete industry, depriving the


people of Northern Ireland of a fuel that is available in every other country in Europe, and consigning to the dole queue people who have given their loyalty and their lives to the industry. To them, the Government have devoted part of a day's business on a Friday. Later today the Government's Lobby fodder will undoubtedly troop obediently into the Lobby indicated by the Government Whips unquestioningly, uncomprehending, and without having spoken. We shall have witnessed the destruction of an industry by executive action. It is the ultimate in political hubris. I am tempted to point out that hubris is inevitably followed by nemesis.
In Committee we looked at the reasons for rejecting the report, which the Minister condescended to give after his announcement of the death sentence. We attempted to show that they were based on a complete failure to read and understand the report. I shall not repeat those reasons in detail, but, lest some hon. Members have not had the opportunity to read the report of our proceedings, I shall list them briefly.
First, the Minister said that the price that the Republic is proposing to charge for gas was based on the fluctuating price of heavy fuel oil, and was uneconomic. In September 1984 that price was 36·4p per therm. The working group's report was based on an anticipated price of 34p per therm, and the profit of £157 million was calculated on that price. Today the price is 28p per therm—6p per therm less than that on which the report was based. The consultants who considered the report tested the working group's proposals against a theoretical price of 40p per therm, and confirmed that the project would still show a profit.
A further question posed both in Committee and today by the hon. Member for Upper Bann remains unanswered. If the Government were troubled that the price of heavy fuel oil tends to fluctuate—that was known to them when they signed the agreement in October 1983—why did they sign the agreement? Today the Minister confirmed that no conversations had taken place with the Government of the Republic since September 1984. So the matter was never aired again, and the Republic was never invited to reconsider it. Nothing about the present price of gas can provide any reason for reneging on the agreement, much less for rejecting the Committee's report.
Secondly, the Minister said that the report overestimated the potential market. Experience of a similar plan in Dublin confirms that the report's estimate was, if anything, unduly moderate. The Minister appears to have based his views on the survey, to which he referred today—I assume that it is the Deloitte, Haskins and Sells survey—and which has been made available to him. We cannot comment on it because he has refused to make it available to anyone else. Suffice it to say that he has reasons, that we know not of. Today the Minister said that earlier reports had yielded a result less optimistic than that of the Committee, but the survey sought to find out who would be likely to buy gas at the prices and conditions proposed in the report. No earlier survey could research into that.
Thirdly, in Committee the Minister criticised the report because it included no estimate for reinforcing the transmission systems and no provision for leakages. He has not mentioned that today, and it simply is not the case. If the Minister reads the report, he will see that both matters are dealt with, and that the appropriate costs are taken into account. The Minister may disagree with the

figures, but how anyone who has read the report can say that there are no such figures is a mystery which admits of no further comment.
Fourthly, the Minister said that the productivity levels envisaged in the report were higher than the present levels in the British gas industry. That comment was made the subject of a devastating analysis in Committee by my hon. Friend the Member for Bow and Poplar, who has long experience as a management consultant. To compare two productivity figures in two different geographical areas, without taking into account the different circumstances, the installation sizes or the equipment used, can only be described, as my hon. Friend said, as superficial, unsophisticated and unscientific. In particular it fails to take into account the fact that the Government are trying to compare an industry which is concerned with generation and distribution with one which is concerned almost entirely with distribution. That is not comparing like with like. The fact is that the productivity figures in Northern Ireland have traditionally been higher than the figures for the whole of Britain.
Finally, the Minister's figures on funding related, as he conceded today, to £70 million which the Government were not being asked to provide in cash, but only to make available by way of a guarantee for an independent loan. I have not dwelt on the detail of these matters. Perhaps we have not fully understood what the Government said about some of them, but they have been ventilated on several occasions, most recently in Committee on 26 June, and until today, none has been answered. The Minister's speech today did not carry any of the arguments a step further. At the very least, those matters merit further discussion, not a rejection of the project out of hand without exploring what has been said.
Even if the proposal in the working group's report is rejected, that is not the end of the matter. In Committee, the Minister was asked about alternative ways to save the industry. The right hon. Member for Strangford (Mr. Taylor) asked about proposals from Europe to integrate the national gas grid. The Minister said today that he knows of no such proposals, but perhaps we could have been told a few more of the facts, if only out of courtesy to the hon. Gentleman who raised the matter.
I asked the Minister about the proposals being explored by Lloyds merchant bank. Neither the hon. Gentleman nor I received an answer, but in the 29 June edition of The Oilman there was a report that Lloyds' was exploring two possibilities: a company to convey gas from the border and distribute it to existing undertakings, or a company that would take over the complete network. A Lloyds' spokesman was quoted as saying:
The amount of the initial investment would be relatively small beer. What is really important is that a competent operator should run the system and make it profitable.
The Minister said today that nothing prevents Lloyds from putting together a scheme for private investment, but he must know that if the industry could be saved, his action today is likely to drive consumers away from the industry before it can be saved. We are simply asking for a breathing space so that these matters can be ventilated.

Mr. Nellist: It seems, not only to the Opposition but to many workers in Northern Ireland, that that is precisely what the Minister intends. The message that he is giving today, and his actions during the past six months, are designed to drive consumers away from gas so that he can say proudly, "I must have been right, because everyone is


deserting the industry." Therefore, by that self-fulfilling logic, he can argue that the industry should have been closed.

Mr. Archer: I agree entirely with my hon. Friend's conclusion. His point is reinforced by the fact that, on the day in September when the announcement was made, people were going round tearing down posters which invited consumers to switch to gas. Whatever was the Government's intention, they cannot be surprised by the fact that many people have come to that conclusion.
The Opposition invite the House to reject the motion on the ground that the avowed purpose of the order—to make provision for the assassination of the gas industry—is misconceived. There is no case for closing the industry. But even if there were such a case, the order simply will not do. If consumers are to be deprived of the option, they will need financial assistance, as the Minister recognised today, to transfer from gas to another fuel. As he said, article 8 of the order provides for financial assistance to consumers. But that article empowers the Department to make a scheme for compensation. It is the provisions of that scheme that are being left to the discretion of the Department. It is under no obligation to bring that scheme before the House. Its only obligation, once it has decided what is in it, is to make it known. So the House is being asked to sign a blank cheque or, more accurately, a blank receipt on behalf of consumers for compensation which may not be forthcoming.
Again, in Committee, we sought to explore what the Government had in mind by way of compensation. Again we received no answers. The Government are proposing to spend £97 million to kill off the industry. In their own argument, they are declining to devote money to saving it. That sum of £97 million does not include the loss in revenue to the Government because people will not be in work and paying income tax, and the vast sum of money consequent upon consigning 1,000 unemployed workers to the dole queue, as my hon. Friend the Member for Middlesbrough (Mr. Bell) pointed out in Committee, that is in place of a subsidy which, according to the Minister, is £12 million a year. If the Government were prepared to continue that £12 million a year, all this could have been saved.
Earlier, my hon. Friend the Member for Coventry, South-East (Mr. Nellist) posed a very reasonable question. If the Government are prepared to spend the money which has been mentioned this morning to increase top salaries by the proportions which have been discussed, £12 million a year does not seem unreasonable to save an entire industry for the consumers and workers of Northern Ireland.

Mr. Ian Mikardo: It is the equivalent of half a dozen field marshals.

Mr. Archer: Half a dozen field marshals, as my hon. Friend says, although if the field marshals do not receive the increase they may feel so dissatisfied with their jobs that they decide to go somewhere else.
We have seen no breakdown of that figure of £97 million. We have only the information that we have been able to drag from the Government by way of correspondence with the working group, or by questions in the Assembly and in this House.
The explanatory document described the £97 million as the cost of the rundown of the industry over a three-year period. The Housing Executive envisages running down the industry over a five-year period. Have the Government taken account of that? Are the three years' costs to be spread over the five years, or are there some more costs about which we have not heard?
I do not propose to rehearse in detail all the matters that we raised in Committee, but I refer briefly to three, about which we are still awaiting answers. If, as appears, the Government are proposing to allocate £200,000 for sealing off gas pipes, how does that compare with an estimate for the same purpose provided to the working group by British Gas of £3 million, especially if it was British Gas which advised the Government on this?
I wonder whether I know the answer. Is it that British Gas would regard it as dangerous, ugly and slipshod simply to blank off the pipes and leave them and the equipment where they happen to be—even in the way of the alternative installation and even if they are taking up space in rooms which will be further limited by the new equipment for alternative fuels? That seems to be what the Minister is proposing. In a written answer to me on 18 June he said:
In disconnecting consumers from supply it is not the existing practice … to remove pipes and fittings on private property once they have been purged and made safe."—[Official Report, 18 June 1985: Vol. 81, c. 99.]
Of course it is not. That is an expense which normally falls on the consumer. But we are speaking of compensating consumers for the expense that falls on them by reason of the Government's decision to deprive them of gas. If they want their pipes and installations taken away, they must pay for it themselves out of any savings they may have or, if they are young, vigorous and skilled, they may do it themselves.
The working group was told that the Government proposed to allocate £20 million to the conversion assistance scheme for what the Government assessed as 80,000 houses, although some of us thought that the figure was higher. How does that compare with the estimate of the Housing Executive, which proposes to spend the same sum on conversions in 10,700 houses which are heated by gas and 6,000 which cook by gas? Is the answer that the Government will offer the consumer no choice of an alternative fuel but base the cost on the cheapest alternative, even if it is quite unsuitable to the consumer?
The House will be grateful to Age Concern for the careful and well-researched note with which it has provided us. It shows that, whereas households in Northern Ireland that are headed by younger people tend to use domestic fuels other than gas, 55 per cent. of households headed by people of 60 and over depend on gas. So it is the elderly and those in middle age who will be most concerned by the provisions that we are discussing. It is also households in the lower economy groups that are most likely to be dependent upon gas. The lowest cost alternative is likely in most cases to be bottled gas, so the elderly will be required to lift about containers of bottled gas and will be at risk of running out of fuel, sometimes at inconvenient times, when the next delivery is not due, and frequently in the winter.
Thirdly, is it envisaged that the conversion costs to be made available to the domestic consumer will include the cost of redecoration? One would have expected that the answer would be yes. If conversion is forced on people,


they should be compensated for the cost of redecoration. But when I asked the Secretary of State about this, the reply was:
In the absence of detailed information on existing gas appliances and individual assessments of the impact of conversion on each dwelling, it is not possible to provide any estimate of the cost of redecoration."—[Official Report, 18 June 1985; Vol. 81, c. 99.]
If it is not known to the Government, and they cannot even make an estimate, that raises the question whether this item has been included in the figures with which we have been provided. If it has not been included, must we add something to the Government's figures for the provision for compensation and for the cost of closing the industry, or do the Government not propose to compensate householders for redecoration?
In Committee, the hon. Member for Antrim, East pointed out that in many homes, conversion to a different fuel would entail rebuilding entire flues to take solid fuel. The Committee wished to know what the Government proposed about that. Had the cost of that been included in existing figures, is it an additional item that we must have in mind, or do the Government not propose to meet the cost which is falling on householders?
It is not only the consumers who have reasons for anxiety. What of those who face redundancy? No doubt they will receive the statutory minimum entitlement under the redundancy fund, but it would be monstrous to close an industry with no other provision for those who are being deprived of their livelihood. The Department says that it proposes to provide £12 million for redundancy payments and outstanding debts. I understand that outstanding debts amount to £11 million and that appears to mean that the Government are proposing £1 million for redundancy payments above the statutory minimum, to be shared among 1,000 employees. That averages £1,000 per employee. Is that all that the Government are proposing, because there will inevitably be those who will contrast that sum for the price of lifetime's employment with the Government's proposals for top salaries?
Our anxiety was not alleviated when we saw a copy of the letter to Mr. Fell of the Department of Economic Development from Mr. McClements, the director of the Northern Ireland Economic Council, dated 28 June. He mentioned that in May 1980, the Department of Commerce estimated that the amount of public expenditure entailed by any closure of the gas industry, at 1980 prices, would be £101·78 million. That is nearly £4 million more than the Government's estimate in 1985, at 1985 prices, and the estimate was based on only 50 per cent. compensation for domestic conversion costs. If the Secretary of State now expects to do the job at 1985 prices for £97 million, what corners does he expect to cut?
Let me try once again. It is no disgrace for a Minister to listen to what is said to him. It is no disgrace for him to declare that, in the light of what he has heard, he has thought again. We would not hold it against the Minister if he changed his mind. Rather, we would congratulate him openly and publicly on having the courage and imagination to respond to the democratic process. We want only to save the Minister from making a ghastly mistake for which future generations will not forgive him. But if he brushes aside our arguments, as he brushed aside all our earlier arguments, we shall register our protest in the Division Lobby, notwithstanding the Government

arranging the business at a most inconvenient time, because we will have no part in this mean, sordid and shameful business.

Mr. Harold McCusker: Like the right hon. and learned Member for Warley, West (Mr. Archer), I think that the Minister probably hopes that this is the last act in the Northern Ireland gas drama—some might say farce. I doubt it. The events teat we have been discussing for the past seven or eight years will come back to haunt the Government one day. That explains why the Minister took half an hour to introduce the order and 10 minutes to deal with its provisions.
When considering how to approach the debate, I thought that the Minister would probably try to play cute and stick strictly to the order, expecting the Chair to save him if hon. Members strayed beyond the strict limits. it struck me that the Minister was doing what many of his predecessors have done—trying once again to justify the decision. He was almost trying to convince himself that he was right.
I do not want to rehash arguments used since 1977. The Minister has heard them all before and I have heard all the answers. The right hon. and learned Member for Warley, West said that the self-fulfilling prophecy element in the debate had existed for only seven or eight months. It has existed for eight years.
The Minister seemed to ridicule the Northern Ireland gas industry for being unable to keep its prices competitive, for losing customers and for having low morale. That is like saying to a man condemned to death in 1977 and put in death row, "Why are you losing the colour in your cheeks?" It is like saying after a year, "Why have you not the same enthusiasm you had a couple of years ago?" The Northern Ireland gas industry has been under sentence of death for seven or eight years.
Publicity has been almost 100 per cent. adverse except for a few months when the industry was given hope that it might be saved by natural gas from the Irish Republic. I fought the case in the early years and I realise that the publicity that I gave to the industry to make my case contributed to the industry's decline. By highlighting the problems the industry was subjected to news coverage which deterred people from using gas or from renewing their equipment.
Northern Ireland does not have the best gas and we have not been able to use the modern equipment that is available on the mainland. Northern Ireland gas consumers do not realise what natural gas would mean for them. I did not realise the potential myself until I visited an Ideal Homes exhibition about five years ago. I suddenly realised that the new gas industry was in a different world. Our equipment has been modernised to some extent to give us choice, but we have nothing comparable to the equipment on the mainland.
All those factors have militated against the industry from day one, and that is the cause of the steady drain of consumers. It is not good enough for the Minister continually to trot out statistics and say that the industry is not worth saving because it has not had self-motivation and has not held on to its consumers. However, I will not go over the arguments again.
Like the right hon. and learned Member for Warley, West, I am concerned about the effect of the order on the handicapped, the elderly and poor people. Will the


compensation arrangements be adequate, not only for conversion but for redecoration and so on? We are aware from constituencies throughout the country that the present levels of assistance offered, for example, by the Housing Executive, for redecoration after rewiring and other improvements are inadequate.
It is not possible to redecorate a room nowadays for between £50 and £70. The costs involved, particularly following the conversion of which we are speaking, can be considerable, especially for people who, in many instances, may have just finished redecorating their homes as a consequence of schemes of modernisation by the Housing Executive. I hope that the Minister will bear in mind our plea in that respect.
The safety aspect of what we are doing also concerns me. In 1977–78, before many people had bought their own homes and were in Housing Executive property in Northern Ireland, the industry was confronted with problems caused by people who, because of the price of gas, did their own conversions. They converted from gas to solid fuel—I am speaking particularly of cases which arose in Ballymena—and because the flues were designed for gas they were a danger when solid fuel appliances were attached to them, yet that happened in many cases.
Steps were taken at that time to rectify the situation and to avoid it recurring, but since then many of those homes have become privately owned. If an owner installs a solid fuel heater, will he be in breach of some regulation? Will monitoring be done to ensure that someone who, perhaps inadvertently, embarks on a conversion—because it is the cheapest way for him to obtain an alternative source of fuel—will not be put at risk? What if that person's neighbour is still a Housing Executive tenant and the conversion done by the private owner endangers not only his life and home but those of his neighbour?
There are grave safety aspects of this issue which, perhaps because we have been concerned with major matters, we may have overlooked. For example, what will happen to the redundant gas system? If I own property and large pipes run beneath it, and later those abandoned pipes are flooded, what guarantee shall I have that the flooding will not undermine the foundations of my home and that gas pockets will not eventually gather there? What guarantee shall I have concerning subsidence, explosions and other dangers that could occur in the future?
Are the Government washing their hands of such issues? Will all responsibility pass to the occupier or tenant? Many people in, for example, Belfast own property which will be substantially undermined by gas pipes. I hope that the Minister will assure us that the dangers and difficulties of which I have spoken will not arise.
Like the right hon. and learned Member for Warley, West, I should like to know how the Government have arrived at the reduction in the price of closure from November 1980 to June 1985. How is it that the total public expenditure cost in 1980 can be £100 million and in March 1985 £97 million? We must have an answer to that question, particularly when we consider that the costs in 1980 were based on 50 per cent. compensation, for 50 per cent. compensation must be less than even the lowest cost alternatives when conversion is done. In a period

when costs must have risen by 30 per cent. or 40 per cent., how can the Minister tell us that the cost of closure has been reduced from £100 million to £97 million?
The right hon. and learned Member referred to what came out of his question of 18 June 1985, when the Minister gave £20 million as the cost of the gas conversion assistance scheme, rising by a further £4 million for full compensation for industry and commerce, plus £9·75 million for the conversion of public buildings. Thus it would appear that between March and June 1985 the estimated cost of conversion fell from £50 million to £30 million. During a period when costs were increasing, how could there be a reduction of that amount?
These matters are very important, for at the end of the day, as many people suspect, we may find that the cost of closing the industry is not £100 million but closer to £150 million. There is no doubt that then the justification that the Minister gave us this morning—he spent half an hour on it—will be trotted out to explain to some Select Committee of the House, "Ah, but we did it all in good faith. Here are the reasons. We had no alternative. We were faced with the economics of Passchendaele, and with `Alice in Wonderland' economics as deployed by Coopers and Lybrand".
Northern Ireland Members know how embarrassing it was to be confronted with the consequences of decisions made by others in regard to companies such as Lear Fan and De Lorean when we had no say in the matter. We have a collective guilt about the losses involved in those two companies. Are we to have another collective guilt about the £150 million used to kill our gas industry?

Mr. Beggs: Does my hon. Friend agree that, as the guesstimate may be so far away from reality, the real cost of closure of the industry could at long last possibly justify a pipeline?

Mr. McCusker: There is no doubt about that.
I have with me the transcript of an interview conducted on RTE this morning with a Mr. Michael Smyth of Lloyds Bank. Several questions were put to him, no doubt sparked off by the reports emanating from the gas industry yesterday about the extra cost of closure. He was asked:
Can it be made not only to break even but to make a profit?
He replied:
I must emphasise that we haven't finished our studies yet … There is that possibility.
He was asked:
Government says closing the whole thing down is going to cost £97 million. Could you make it work with that?
He replied:
No problem at all. If you could offer that to a potential investor, I think there would be a queue of them at the door.
I am not suggesting that the Minister should now make a gift of £100 million to anyone who comes forward with a scheme to save the Northern Ireland gas industry, but if there is the possibility of some private investment, and if Lloyds Bank is interested in putting up some money, should not the Minister give serious consideration to providing a fraction of what it will cost to close the industry? If there would be a queue at the door for £97 million, there would still be a few people queueing for £30 million, £40 million or £50 million.
Would it not be a better use of public funds to use the money for that purpose rather than to spend £150 million to close the industry and put 1,000 people on the dole? I think it would, many people in Northern Ireland think it


would, and the industry certainly thinks it would. Coopers and Lybrand thinks it would. A representative from Lloyds Bank thinks it would. Why does not the Minister?

Mr. A. Cecil Walker: I feel that I must commiserate with the Minister of State in his unenviable task of steering the order through the House. With his customary flair and dedication, he has pursued the task with vigour and determination. It has not been his fault that he has had the misfortune of being in the wrong place at the wrong time, and is now saddled with the job of making the case for killing off our gas industry, which, in the past, has produced profits that built our beautiful city hall in Belfast. It provided cheap energy for the domestic needs of thousands of our citizens. It was responsible for industry that developed from as far back as the industrial revolution. In those days, we used coal as our base fuel. Many of us remember the coke-burning furnaces, the tar, the creosote, the coal oil and many more by-products that supported other large sections of our population.
I congratulate the Minister on making such a formidable case for closure. His powers of persuasion and reasoning, together with the figures and statistics that he quoted, would leave no doubt in most people's minds that there is now no case for gas in Northern Ireland. However, I am sorry to say that, although I have the greatest admiration and respect for the Minister, I cannot support the order because I believe implicitly that a gas supply could have been provided at a cost less than that of closing the industry and that the reason for closure must have political roots.
The wording of article 6 of the order leaves much to be desired. It gives me the impression that the Department is not being fair and honest with the gas undertakers in its commitment. Statements such as:
The Department may … make payments … at such times and on such terms and conditions as the Department may, with the approval of the Department of Finance and Personnel, determine.
appear to be a trifle ambiguous or even devious, according to the interpretation that one may draw from such statements. Similarly, paragraph (2) is little better. It states:
Without prejudice to the generality of paragraph (1), the terms and conditions on which a payment is made under that paragraph may include terms and conditions as to the repayment by the gas undertaker to the Department of any part of any such payment in such circumstances as may be specified by the Department.
One could be forgiven for asking just what those terms and conditions are. There is not an inkling in the order as to what is in the Minister's mind. I am sure that the gas undertakers will be wondering just what is involved for them in running down the industry. The Government should be much more explicit in framing such paragraphs if one is not to think that there will be some abdication of responsibility on their part.
I support the right hon. and learned Member for Warley, West (Mr. Archer) when he expresses concern about article 8 on financial assistance to consumers. I am pleased that the Government state categorically in paragraph (1) that they will
make a scheme … towards the replacement or adaptation of gas appliances where such replacement or adaptation is necessitated by the cessation or expected cessation of the supply of gas".

However, I am certainly not at all happy with paragraph (2), which states that a scheme may
prescribe the persons to whom financial assistance shall be paid".
I hope that everyone who is inconvenienced by being deprived of his gas supply will be considered eligible for compensation.
I am also concerned about paragraph (2)(b), which states that the scheme may
provide that no financial assistance shall be paid in such cases or in such circumstances as may be specified in the scheme".
I am most unhappy that when the supply is terminated, people may not have a legitimate claim against the Government, assuming that no debts are due to the undertaking under the terms of paragraph (2)(c).
On compensation in general, the Minister will know that the gas industry joint working group publication based on the Northern Ireland Housing Executive paper on the cost of conversion shows that the Government's plans for compensation are inadequate. For example. the cost of replacement of heating and cooking facilities is estimated at £60 million but the Government intend to pay only £20 million in compensation, leaving two thirds of the cost to be met by consumers. The report shows that it will cost £24 million to carry out the Housing Executive's conversion programme, but no provision is made for that extra money, so the housebuilding and renovation programme will be hit. The housing associations are unlikely to find money elsewhere as they are funded on only four specific projects, so if they have only the equivalent of the Government compensation they will riot be able to treat their tenants as the Housing Executive can treat its tenants. The Housing Executive's programme is expected to last for between four and five years, two years longer than the Government expect, so two additional years' subsidy will be needed for operational deficit. That probably represents a further £25 million on top of the Government's estimate.
My constituency has the highest proportion of elderly people in relation to the population. I am most concerned about those senior citizens, many of whom are frail and confused. The majority of them use gas, so closure will mean that they face major upheaval through no fault of their own. The ramifications of the compensation scheme have not yet been defined, but I hope that those with arrears of payment will be treated sympathetically.
The right hon. and learned Member for Warley, West dwelt at some length on the least cost compensation clause. This provides that if a serviceable electric cooker socket does not already exist, the least cost option, at least for pensioners, will be bottled gas. The other options are solid fuel and oil, which present bulk storage problems. No allowance is made for the present or future ability of elderly people to cope with the replacement fuel. There are bottle gas delivery services but some lifting of heavy containers by pensioners is unavoidable. There is also the risk of interruption of deliveries, leaving pensioners without fuel in hard weather, when they are most vulnerable. Solid fuel involves similar lifting problems and there is a risk of hypothermia if there is a delay in lighting fires.
I have already expressed concern to the Under-Secretary of State responsible for housing matters, the hon. Member for Bath (Mr. Patten), about the difficulties faced by pensioners in clearing grates and lifting solid fuel. In many parts of my constituency able-bodied


volunteers ensure that fires are lit and maintained for pensioners, especially in the winter months, but more consideration must be given to ensuring that the most appropriate fuel supply is provided for pensioners. Serious consideration should also be given to providing compensation for the inevitable redecoration that will have to be carried out because of the changeover from gas to an alternative fuel.

Mr. Mikardo: There will be an additional loss, for which compensation ought to be paid. If gas piping remains in position while apparatus for another form of heating has to be installed, there will be a loss of space. People will lose a bit of their living room. I should want compensation if I had to lose a bit of my not very large living room.

Mr. Walker: I agree wholeheartedly with the hon. Gentleman. I am sure that he agrees with me that compensation ought to be provided for the inevitable redecoration because of the changeover from gas to an alternative form of fuel. Elderly people face difficulty in redecorating their homes. It is only right that money should be provided to enable redecoration to be carried out.
A full consultative and advisory service ought to be made available to pensioners so that they know that financial assistance is available. I should like large-print publicity to be provided so that pensioners can be made aware of the procedures. I should also like there to be home visits from advisers approved by the Government. It is imperative that all the voluntary agencies should be kept fully informed of the developments so that they, too, can subscribe to the welfare of this very deserving section of the population.

Mr. Dave Nellist: The Minister of State, Northern Ireland Office, intends, virtually at the stroke of a pen, to initiate the closure of an industry in Northern Ireland which will lead directly to the loss of a minimum of 1,200 jobs. In recent weeks and months his decisions have closed down the most viable alternative—the Kinsale gas project—and sounded the death knell for those who work in the industry and for the consumers whom those workers serve. He seems to be looking for a new reputation. He is becoming known as the MacGregor of Northern Ireland.
All we heard about this morning and during various Question Times, in which I have participated, since November of last year was the uneconomic nature of the gas industry. Images are being introduced which mirror or parallel those which MacGregor provided for the coal industry. Just as there was the same falsity in the arguments of MacGregor and the Secretary of State for Energy about the real costs of the closure programme—the loss of 70 pits and 70,000 jobs—so the real cost of the closure of this industry is being masked by the Minister of State.
Some reports, including those which have been mentioned this morning and during the Northern Ireland Committee proceedings on 26 June, put the closure costs at about £97 million. From a phone call that I had about an hour ago, I understand that a report, which may have included Government involvement and which was leaked

on Wednesday of this week, puts the cost of the closure programme at about £140 million. We have heard that the figure will be higher than that. Whatever it may be—£97 million, £140 million, or more—that is far more than the cost of maintaining a viable industry, particularly when one takes into account the additional cost of unemployment, social security, lost tax revenue, national insurance and the wealth that is created by having people in work rather than languishing in the dole queues.
The Minister of State referred to the gas industry extracting subsidies from the Government that have risen from £2 million a year to £12 million—a difference of £10 million a year. I intervened at that point, and I refer again to what I said then. The supreme irony. four hours after points of order and two and a half hours after a statement, is that £9 million or £10 million is to be given this year to fewer than 2,000 people: the top people in the judiciary, the Civil Service and the armed forces, many of whom went to the same schools, eat at the same restaurants and belong to the same clubs as members of this Tory Cabinet. Those people are getting £9 million in wage rises, yet the Government are not prepared to spend a similar sum to give another 12 months' employment to workers in the Northern Ireland gas industry.
The Minister spoke about consumers deserting the gas industry. He said that about 10,000—one in seven—no longer use gas for cooking or heating. But if gas in Northern Ireland cost the same per therm as gas in Britain instead of, in some cases, three or four times as much. consumers would not have transferred from gas. Indeed, more consumers would be relying on that source of energy.
The Government ought to arrange parity in what working people pay for their energy sources, whether they live in Northern Ireland or in Great Britain. If the cost of gas in Northern Ireland had been reduced to the United Kingdom average, I am sure that those 10,000 consumers would still be using gas.
Working people must note the cost of the closure of the gas industry to the 100,000 or so households who rely on gas for cooking or heating. There will be a particular burden on the low income groups—the low paid, the unemployed and the elderly. We have heard eloquent testimony of the problems that will be created if an alternative fuel such as bottle gas is the only option offered to elderly people.
The Minister's estimates of the compensation costs to consumers work out at about £200 per household. That has to cover the provision of a new fuel, redecoration of the property and, in many cases, the even greater expense of rebuilding flues and brickwork. All that is supposed to be done for £200.
The only specific example given in Committee of a similar transformation was offered by my right hon. and learned Friend the Member for Warley, West (Mr. Archer). There is no point looking in the crystal ball when we can read the history book, and it is no good predicting how cheap conversion will be when we have evidence that that will not be so.
The Northern Ireland Housing Executive withdrew gas supplies from an estate because the gas appliances were out of date. The cost to the executive of the changeover in those 129 houses was £250,000—£1,938 per house, or 10 times the Minister's prediction of conversion costs.
If the figures from that example are applied to the 100,000 households that will be converted if the Minister


gets away with his plan to close the gas industry, we are talking not about £20 million for redecoration, rebuilding and so on, but £200 million—over twice the most quoted estimate of the total cost of the closure of the gas industry. Who will pay that? The cost will be put on rents, rates and taxes. It will he taken out of the pockets of working people.

Mr. Beggs: Does the hon. Gentleman agree that it would be wrong if the Northern Ireland Housing Executive had to allocate funds for improvements out of its existing budget when there are so many urgent housing needs in Northern Ireland? Does the hon. Gentleman also agree that we should be told how much is being allocated to the NIHE for home conversions?

Mr. Nellist: I agree. It cannot be denied that housing in Northern Ireland is among the worst in Europe, and its condition bears no relation to the religious divide. It is easy to find houses on the Shanklin road or the Falls road without basic amenities, such as inside toilets, baths and hot and cold running water. There are areas where the proportion of such houses might be 60 per cent. Any attempt by the Government to offset against Northern Ireland Housing Executive expenditure the cost of the transformation from gas to another fuel would be deplorable and should be resisted by people who live in the areas concerned, members of the Northern Ireland Public Services Association who work for the Housing Executive and by the trade union movement in Northern Ireland. The executive's money should be used to raise the standard of housing in Northern Ireland to the highest possible level.
In the past six years, Northern Ireland has been savaged by Tory policies. Output in the north of Ireland has been reduced by 14 per cent. and industrial employment has fallen by 30 per cent. Northern Ireland is now virtually an industrial desert.

Mr. Pawsey: When will the hon. Gentleman condemn the IRA?

Mr. Nellist: I am coming to that, if the hon. Gentleman can contain himself. If the hon. Gentleman has attended debates during the past two years while I have been an hon. Member, he will know that, on issues such as Sri Lanka, Ministers and the Government have tried to throw terrorism at me. I am a Socialist, whether it be on the green or orange side of the divide and the hon. Gentleman will have heard me condemn all sectarian or paramilitary groups trying to change the situation in Northern Ireland by methods of individual terror, the bomb and the bullet. They do no good to working people in any part of the country.
The official unemployment rate in Northern Ireland is now 21 per cent.—more than 120,000, half of whom live in the city of Belfast. An extra 1,000 redundancies and the closure of the gas industry are a tremendous burden to put on working people in that area. If we consider the real level of unemployment, counting people on youth training schemes, people aged over 60 and women who are not counted—the calculation that we have to make in Great Britain to establish the real unemployment figure under this Government—we discover that there are 160,000 or 170,000 unemployed. What guarantee will there be—I notice there is nothing in the order—to working people in the gas industry that, having closed the industry, the Government will offer them alternative work? What will

the Minister tell them? Will he emulate the words of the Secretary of State for Trade and Industry and suggest that they get on their bikes? To which area of the North are they supposed to go? Do they go to Strabane, where unemployment for men is 53·9 per cent.? Do they go to Deny, where it is 38·6 per cent.? Do they go to Coleraine, where it is 32·2 per cent.? Do they go to Enniskillen, where it is 33·2 per cent.? Under this Government, mass unemployment is endemic in Northern Ireland. A further 1,200 job losses as a result of the closure of this industry will be another nail in the coffin of working people in the North.
I advise, through the channel of the House of Commons, that trade unions in the gas industry should offer no co-operation in the massacre of that industry. They should offer no co-operation with the Government. They should step up the campaign involving workers and their families and take it from workers in the gas industry to other industries where jobs will be affected by the Government's plan. Various newspapers have mentioned the threat to those for example like Hughes Tools, bakeries and engineering plants whose livelihoods might be threatened by the closure. Those workers should be welded together in a campaign to oppose the plan.
As we are debating an order which expresses one point of view—that the gas industry in Northern Ireland should be dismantled—I am entitled to put another. I suggest that those workers consider stepping up the campaign for the nationalisation of the gas industry in the North and for its control to be put in the hands of a board of directors on which the majority of votes come from the trade unions and the stewards' committees in the industry and the trade union movement.—[Interruption.] If Tory Members—there are now two or three of them, but there were not many when we started the debate—want to put up a case in favour of closing the industry, if they want to justify another 1,200 people in Northern Ireland going on the dole and if they want to come clean with the working class in Northern Ireland, they can do so when I sit down.
I emphasise the need for control and management by workers. The single most important lesson to learn frorn the farces of De Lorean and Lear Fan is that one cannot control what one does not own. Working people in Northern Ireland—indeed, anywhere in the United Kingdom—should own and control the industry in which they create the wealth, which is then stolen by the Government.

Mr. Robert Atkins: How could the workers have controlled Lear Fan, bearing in mind that lie problems there were largely related to engineering and technical difficulties, which they could not have solved?

Mr. Nellist: In the hope, Mr. Deputy Speaker, that you do not find that question too wide of the mark, I shall reply briefly. I have a far higher regard for the technical, political and industrial skills of our working people than of any Tory Member. Four years ago the Lucas work force faced the prospect of 4,000 redundancies. It called together all the stewards, who then called meetings of every section of the industry, and an alternative plan was drafted. It stated that instead of being sacked for not producing sights for nuclear bombers, the workers could produce kidney machines, road and rail transport equipment, heat pumps, long life batteries and so on. I am


convinced that if the workers had been given a say in Lear Fan, they could have come up with alternative products, which would have been more useful to the working class, using their engineering skills, their techniques, the tooling and materials, instead of being thrown on the dole.
We need to oppose the order in the House with a vote and outside it. The trade unionists and their families in the North should link up with other trade union organisations and mount a massive campaign of opposition.
I make no apology for finishing on this point. A Labour party must be built up in Northern Ireland to put forward plans for publicly owned and co-ordinated energy industries, decent houses, jobs and high living standards. I hope that from that campaign of opposition—the linking of trade unionists, members of joint shop stewards' committees, community organisations, trade councils and tenants' organisations—a Labour party can be built to oppose all the economic, industrial and political decisions of the Tory Government.
Clearly, during the past 15 years, the working classes have suffered most from sectarianism and the orange-green divisions. But not one major strike or struggle, whether involving civil servants, fire fighters, teachers, health workers or miners, has been broken by sectarianism. The hope for working class unity lies with the trade unions and working class organisations. I hope that the campaign will strengthen the quest to form a Labour party in the North.
I hope that the Government are defeated on the proposed closure of the gas industry in Northern Ireland, and thrown from office once and for all.

Mr. Roy Beggs: I shall remain on safer ground by supporting entirely the speeches of my colleagues from Northern Ireland. I cannot endorse all the observations of the hon. Member for Coventry, South-East (Mr. Nellist). We certainly have serious unemployment. If ordinary people could resolve their problems, they would, but the unemployed, who are sufficiently intelligent and as capable as anyone else, have not been able to resolve our problems. We depend on maintaining existing industries with Government support and by encouraging investment and new manufactured products.
Since the hon. Member for Brent, North (Dr. Boyson) became Minister of State, he has earned a reputation for being energetic, hard-working, straightforward, direct, helpful and constructive in relation to the needs of Northern Ireland. Unfortunately, his good record has been tarnished by his decision to close the Northern Ireland gas industry. To some extent, I blame the officials who advise him for that. The speed of the rejection of the rescue plan for the gas industry has caused the Minister to be considered as the Government's hatchet man, responsible for axing 1,000 jobs and finally killing an industry that has been strangled by the indecision of successive Governments, who supported it financially but who instilled inadequate confidence in consumers. That contributed to customer loss of confidence in ever having reasonably priced gas supplies, so they started to drift away from gas.
The decision not to provide gas from the British gas grid sentenced the Northern Ireland gas industry to decline and to dependence on a subsidy which, as the Minister said,

increased annually without any hope of the industry becoming viable. The 80,000 gas customers left in Northern Ireland have been badly let down. Northern Ireland will soon be the only part of the United Kingdom that cannot share in benefiting from the nation's gas reserves and all the advantages that flow from the availability of natural gas. Their choice for heating will be restricted largely to LPG, with which the elderly find it difficult to cope, electricity or solid fuel.
Many well-informed people believe that all the signs point to the existence of oil and gas reserves off the coast of Northern Ireland. Will the Minister assure the House that the Government have placed no obstacles in the way of exploration? Have they given positive encouragement to those who wish to explore for offshore oil and gas reserves from which Northern Ireland could benefit?
In evidence to the Economic Development Committee of the Northern Ireland Assembly, the Minister said:
To lay down piping for natural gas which the Republic of Ireland would sell to us at a price equivalent to that of heavy fuel oil is to be on a loser before one starts.
That must show clearly—to those who wish to see it—that the Kinsale gas deal was a red herring from beginning to end. However, it served as a useful distraction from the proposal to build a pipeline to the mainland had the Government been willing to link Northern Ireland to mainland supplies. Have the Government seriously considered a pipeline across the north channel from Scotland? Does the Minister know whether applications have been made for EC finance to assist this possible project? What is the current estimated cost of running a gas pipeline from Northern Ireland to the mainland?
Will the Minister assure the House that, in the event of substantial gas discoveries off Northern Ireland, money will be made available to provide a new distribution network and to establish a modern, viable gas industry?
I share the concern expressed this morning about job losses, and I welcome the time that was given for further consideration and consultation, although it did not turn out to be very satisfactory as the consultation was felt not to be all that meaningful.
I am also concerned about the level of compensation and about the timing of the rundown and closure. Knowing as I do the somewhat haphazard way in which the Northern Ireland Housing Executive organises work programmes, I shall be concerned to ensure that pensioners are not left without heating and cooking facilities in the middle of winter by a badly organised rundown and closure.
I congratulate the gas industry joint working group on its efforts to save the industry, but my colleagues and I are not convinced that the Government gave it the consideration that it deserved. I trust that the guesstimate—I used that word earlier because it is a rather rough estimate of closure costs—will be adequate to meet the real cost of the industry's closure and the cost of replacing and reinstating property to domestic consumers.
I am not satisfied with the level of compensation available to industrial users. They, too, have been obliged to incur new expenditure for which they have not planned. It has been forced on them by the Government's decision to end subsidy to the gas undertakings.
I hope that the Minister will assure the House that his Department and the Northern Ireland Housing Executive will work together very closely to protect the consumers especially the aged and handicapped.
I am also concerned about the obvious lack of interest of Government supporters in the real problem that we face and the absence of contributions, apart from haggling and interruptions, by the small number of them in attendance today. There was not a word from any of them in the Northern Ireland Committee, although we can almost predict how the vote will go at the end of this debate.
I remain opposed to the closing down of the Northern Ireland gas industry.

Dr. Boyson: The problem of the rundown of the gas industry has been with us for 10 years. At some stage a Government had to make up their mind. This Government did. After years of wobbling, a decision was made. However distressing it may be, that decision had to be made.
None of those who voted against the proposal before the Northern Ireland Committee and none of those who voted it down in the Northern Ireland Assembly carry any responsibility for Government policy. Obviously it was possible for them to vote against our proposal because they were not responsible for the budget. Their action was one of those freaks of freedom which occur from time to time and which people enjoy. But it must be recognised that, had the positions of the parties been reversed, a Labour Government would have made the same proposal.
We have heard a great deal about compensation and the estimate of £97 million. That is the best estimate that we have. It was brought to us by the British Gas Corporation, which has the greatest experience in these matters and believes that the figure will be about that.
I was asked about the breakdown of the figures. Some £12 million is for the deficit support for 1984–85. We have to prop up the industry while it runs down, just as it has been propped up year after year. One of the problems has been that it has needed a bigger prop every year. Ten years ago. the gas industry needed £2 million a year to support it, but now it needs £12 million a year. One could imagine what the figures would be if we continued supporting it. Some £120 per household is spent in subsidy, and if all the energy sources in Northern Ireland were subsidised at the level of the gas industry, £600 million of subsidy would be paid.
In 1987–88, the closure support will require £20 million for conversion, including £18·5 million to the Housing Executive. The operation deficit, the termination costs such as works closures, purging and the rest will cost about £12 million. The whole cost adds up to £97 million.
I was asked why figures are different. In many cases, the figures for compensation have decreased because the number of houses that will have to be compensated has decreased with the years. It decreased by one eighth in the past year alone. Most people have covered the cost themselves.
It is worth reminding the House that this is not a nationalised industry and there is no legal obligation on the Government to give compensation. The gas industry is run by private concerns. The hon. Member for Coventry, South-East (Mr. Nellist) may be horrified to learn that we are giving compensation to customers of private concerns that cannot make a profit. I do not want to affect his political purity.

Mr. Nellist: The Minister says that we are talking about private, not nationalised, concerns, but the order is

designed to remove a statutory duty from those private companies for the supply of gas. Therefore, it strangles the industry and the Minister is acting in the same way as MacGregor in the coal industry.

Dr. Boyson: The hon. Gentleman is obviously a seeker after truth and desires to hold to the truth in every way. We are not closing the gas industry; it is closing itself because we have said that it must run on its own money. If we followed the hon. Gentleman's theory, we would prop up everything in the country, including private industry. The hon. Gentleman is opposed to private industry, but he wants this subsidy to continue. I do not doubt his political morality, or even his fervour, but I am astonished, and some of his supporters may be astonished when I bring it to their attention, to hear that he wants continued compensation for private industry that cannot make a profit. He is advocating not the nationalisation of these concerns, but their continuation, although they are not making a profit and are run by private directors.
The hon. Gentleman is obviously a political thinker, so he should think about these things. He should remember that there are 13 concerns involved in the gas industry. We know that 13 is not a lucky number. It is not a football team or a rugby team. Nobody likes 13, so perhaps the hon. Gentleman has been misled by the number. Perhaps the number 13 has put a spell on him.
Four of the concerns are private and nine are run by corporations. The only one of the 13 that is continuing because it can still make a profit is a private firm. The hon. Gentleman should think about that. The workers will lose their jobs because the concerns run by corporations cannot make a profit. In one concern, their jobs are being saved because the private firm is making a profit.
I am concerned about unemployment, as we all are. The hon. Member for Holborn and St. Pancras (Mr. Dobson) may laugh. I do not accept that there is a morality on Labour Benches that does not exist on this side of the House. I have great respect for the hon. Member, hut he must have more breadth of vision.
The hon. Member for Belfast, North (Mr. Walker) spoke about compensation. I know what his area is like, and I have walked through it with him. We shall do all that we can through voluntary organisations, pamphlets with large print for old people, and other important devices that must not be neglected to make sure that the consumers know what we are doing and what their opportunities are. When the closure notices are issued it is important for hon. Members, who have close contact with their constituents, to keep in touch with the Department and the gas undertakings to ensure that the job is done properly arid that people do not fall out because they do not understand what is going on.
We are following British Gas practices on safety to provide for a safe and orderly rundown of gas supplies to consumers. When new appliances are installed, they will be made safe wherever they are. I can assure the hon. Members for Antrim, East (Mr. Beggs), Belfast, North and Upper Bann (Mr. McCusker) about that. The grants are intended to cover the cost of all essential work associated with the installation on the basis of the least cost alternative. We do not want people to believe that they are receiving compensation. I do not want to mislead the House about that.
We are following the practice used for the clean air scheme which was a more difficult scheme for the ordinary


householder. We are paying for installations on the basis of the least cost alternative. In Committee hon. Members asked about the handicapped. The least cost alternative must be workable for the individual. It would be no use installing equipment which an old couple, for example, could not work. Decisions will be based on human need.
The question of the right of appeal was raised in Committee. I said that I would see what we could do, and we are looking into the issue. I shall retain contact with hon. Members about that.
I worked with Age Concern closely when I was a Minister in the Department of Health and Social Security. In its material it does not consider the figures which I am about to give to the House. At issue is how much, with the alternative system, heat and lighting will cost compared with the present system. The figures are good news. Central heating run on town gas for a terraced house costs £553 a year. Similar central heating using coal costs £289 per annum. That is why people have converted to coal in the last few years. Coal central heating costs only half as much.

Mr. Beggs: The Minister gives us the best figures available, but when people convert to a new system it takes time to adjust and to control how much energy they need to provide the heating that they want. One can turn off a gas fire, but one might have to keep a fire burning 24 hours a day.

Dr. Boyson: I share the faith in the ordinary people expressed by the hon. Member for Coventry, South-East. I grew up in Lancashire where coal was used to heat our homes and I am sure that, as then, people will use their heating sensibly. Sometimes the ordinary person can cope better than the officials who try to advise them. I could give similar figures for cooking and other heating, but in the long term it will be cheaper for people to convert to other fuels.

Mr. Stuart Bell: Will the Minister take note of the statment by my right hon. and learned Friend the Member for Warley, West (Mr. Archer) in Committee that the Northern Ireland Housing Executive estimates that it would cost £20 million to deal with conversions for only 10,700 homes with gas heating? Are those figures correct?

Dr. Boyson: I shall not, because of shortage of time, go into the detailed costs, but I will write to the hon. Gentleman within a few days. So many statistics have been given that I prefer to look into the matter to make sure that my reply is accurate.
The hon. Member for Coventry, South-East questioned me about housing. I would not like hon. Members to go away for the weekend without realising how much money the Government have put into housing in Northern Ireland. About £500 million a year has gone to that sector and a vast number of homes have been completed. I agree that more remains to be done, but I should not like it to be thought that the Government had not taken action on that front. The Labour party, when in office. did what it could to provide homes, and the programme has been accelerated since we come to power. Housing has been one of our three priorities and whole areas of Belfast and Londonderry have been rebuilt.

Mr. Nellist: rose——

Dr. Boyson: I will not give way because time is short. Anyway, the hon. Gentleman must not keep asking questions before I have answered his earlier questions. For example, he questioned me about jobs, but I do not think that he correctly followed what I said. Nobody wants more unemployment—at any rate, nobody I know wants to see more people out of work—and, although this action will mean 1,000 people losing their jobs in the gas industry, jobs will be provided in relation to alternative fuels, and similar men and women will take up those jobs.
It is likely that more jobs will be available because the distribution of coal has a strong labour content, and the same applies to liquid petroleum gas. The odds are that in the long term in the Province there will not be fewer jobs. We are shutting down gas, not to save jobs, but to enable the money that is being used in that sector to be used for lignite and coal, so securing cheaper fuel for the Province. I assure the hon. Member for Coventry. South-East that we are as concerned as he is about unemployment. He has no monopoly of virtue on that issue.

Mr. Nellist: I do not expect to convince the Minister about the loss of jobs and the lack of alternative employment. I am anxious to press him, however, on the question of redecoration, the replacement of flues and brickwork to cater for new fuels and housing costs generally. He says that £20 million is available for conversion. It has been estimated by the Northern Ireland Housing Executive that the cost of conversion will be £1,938 per household. For 80,000 to 100,000 households, we are talking of £160 million to £200 million. If the costs of conversion exceed £20 million, will the money that the Government at present provide for housing be diverted from repairs and renovation to conversion, or will new money be provided?

Dr. Boyson: I pointed out that the estimates, prepared by the British Gas Corporation, were the best available to us. The conversion will take place and the cost will come from the grants that we give for this to the housing areas. There is no question of the money coming from somewhere else. If we are wrong about the cost, we shall have to spend more money on it. The position is as straightforward as that.
We have said nothing about decorations. I have made perfectly clear what will be covered. Indeed, the clean air legislation did not include redecoration and so on. We have talked about putting in the cheapest alternative fuel that can be used, and if a new chimney is needed it must be provided. However, it does not mean taking out gas pipes and so on. That is the arrangement and that is what happens in this country, under the clean air legislation and similar provisions.
I have made the position clear. We shall cover all the costs of putting in the alternative fuel, but—I repeat that there is no difference between what we are doing in this respect and what happened with the clean air legislation—redecorations and the rest are not covered. In other words, we are following practice—[Interruption.] People may desire more, but we have made the position clear from the beginning.
We have been frank about all of this and the facts have been written down. If people cannot read the words, I cannot go round providing everbody with spectacles. There is no trick involved, no messing about, and we could not have been more frank.
Any Government subsidising every gas consumer at the rate of £120 a house, and facing an ascalation of cost of gas from a £10 million a year subsidy to £12 million a year—equivalent to £600 million if all the energy in the Province is subsidised in the same way—would have made the decision that we have made. Any Opposition Member who does not believe that should look at himself in the mirror.
We have faced reality in a responsible way. We are providing money for the transfer of Kilroot to coal which will say £25 million a year, because it will be cheaper than the alternative heavy fuel. Similarly, we are backing lignite. That will create jobs. Let us have more jobs in Northern Ireland. No one will he more pleased than myself if we get them.
I commend the order to my right hon and hon. Friends and trust that the House will approve it.

Question put:—

The House divided: Ayes 110, Noes 35.

Division No. 285]
[2.15 pm


AYES


Ashby, David
Fowler, Rt Hon Norman


Atkins, Robert (South Ribble)
Franks, Cecil


Baker, Nicholas (N Dorset)
Gale, Roger


Baldry, Tony
Galley, Roy


Blackburn, John
Ground, Patrick


Boscawen, Hon Robert
Gummer, John Selwyn


Bottomley, Peter
Hamilton, Neil (Tatton)


Bowden, Gerald (Dulwich)
Hampson, Dr Keith


Boyson, Dr Rhodes
Hanley, Jeremy


Braine, Rt Hon Sir Bernard
Hargreaves, Kenneth


Bright, Graham
Harvey, Robert


Brinton, Tim
Hayward, Robert


Bruinvels, Peter
Heathcoat-Amory, David


Buck, Sir Antony
Heddle, John


Burt, Alistair
Hind, Kenneth


Butcher, John
Howarth, Alan (Stratf'd-on-A)


Butler, Hon Adam
Hubbard-Miles, Peter


Butterfill, John
Hunt, John (Ravensbourne)


Carlisle, Kenneth (Lincoln)
Hunter, Andrew


Carttiss, Michael
Hurd, Rt Hon Douglas


Clark, Dr Michael (Rochford)
Irving, Charles


Cope, John
Jessel, Toby


Couchman, James
Jones, Gwilym (Cardiff N)


Cranborne, Viscount
Jones, Robert (W Herts)


Currie, Mrs Edwina
Key, Robert


du Cann, Rt Hon Sir Edward
King, Roger (B'ham N'field)


Dunn, Robert
Knight, Greg (Derby N)


Durant, Tony
Lang, Ian


Eggar, Tim
Lawrence, Ivan


Evennett, David
Lennox-Boyd, Hon Mark


Fairbairn, Nicholas
Lilley, Peter


Finsberg, Sir Geoffrey
Lloyd, Peter, (Fareham)


Fletcher, Alexander
McCurley, Mrs Anna


Forth, Eric
Major, John





Mather, Carol
Stanbrook, Ivor


Maude, Hon Francis
Stern, Michael


Merchant, Piers
Stevens, Martin (Fulham)


Mitchell, David (NW Hants)
Stewart, Ian (N Hertf'dshire)


Murphy, Christopher
Terlezki, Stefan


Newton, Tony
Thompson, Donald (Calder V)


Norris, Steven
Thompson, Patrick (N'ich N)


Parris, Matthew
Thorne, Neil (Ilford S)


Pawsey, James
Twinn, Dr Ian


Portillo, Michael
van Straubenzee, Sir W.


Raffan, Keith
Viggers, Peter


Rhodes James, Robert
Walden, George


Roe, Mrs Marion
Waller, Gary


Rumbold, Mrs Angela
Wardle, C. (Bexhill)


Sainsbury, Hon Timothy
Wheeler, John


Shepherd, Colin (Hereford)
Wilkinson, John


Silvester, Fred
Wolfson, Mark


Sims, Roger
Wood, Timothy


Soames, Hon Nicholas



Speed, Keith
Tellers for the Ayes:


Spicer, Jim (W Dorset)
Mr. Archie Hamilton and Mr. Michael Neubert.


Squire, Robin





NOES


Archer, Rt Hon Peter
Mikardo, Ian


Atkinson, N. (Tottenham)
Miller, Dr M. S. (E Kilbride)


Beggs, Roy
Nellist, David


Bell, Stuart
Nicholson, J.


Clarke, Thomas
Orme, Rt Hon Stanley


Cocks, Rt Hon M. (Bristol S.)
Pavitt, Laurie


Cohen, Harry
Pike, Peter


Cook, Frank (Stockton North)
Roberts, Ernest (Hackney N)


Deakins, Eric
Shore, Rt Hon Peter


Dobson, Frank
Skinner, Dennis


Dubs, Alfred
Soley, Clive


Freeson, Rt Hon Reginald
Taylor, Rt Hon John David


Godman, Dr Norman
Walker, Cecil (Belfast N)


Hogg, N. (C'nauld &amp; Kilsyth)
Wigley, Dafydd


Hume, John
Woodall, Alec


Janner, Hon Greville



McCusker, Harold
Tellers for the Noes:


McKelvey, William
Mr. Sean Hughes and Mr. Robin Corbett.


McWilliam, John



Maynard, Miss Joan

Question accordingly agreed to.

Resolved,
That the draft Gas (Northern Ireland) Order 1985, which was laid before this House on 11th July, be approved.

BUSINESS OF THE HOUSE

Ordered,
That, at the sitting on Tuesday 23rd July, the Motion in the name of Mr. David Steel relating to the Statement of Changes in Immigration Rules (Cmnd. 9539) may be proceeded with, though opposed, until half-past Eleven o'clock or for one and a half hours after it has been entered upon, whichever is the later.—[Mr. Lennox-Boyd.]

Voluntary-Aided and Church Schools

Motion made, and Question proposed, That this House do now adjourn.

Mr. Tony Baldry (Banbury): I am grateful for the opportunity to raise the subject of the funding of voluntary-aided and church schools and especially the problems of two schools in north Oxfordshire, the Blessed George Napier school and Bishop Carpenter school. I am also grateful for the support today of other hon. Members, including my hon. Friend the Minister for Oxford, East (Mr. Norris).
As I was educated at a Quaker school run by a religious minority, I am well aware of the contribution that religious and church schools make to the richness of education in this country. I have no doubt that Conservatives have a continuing commitment to seeing church schools flourish as a purposeful demonstration of our desire not only that parents should have the widest possible choice in the education of their children but that they should be able to see their children educated in such a way as to encourage regard for Christian values and to instil self-discipline, courtesy and respect for others, and I know of my hon. Friend the Minister's support for church schools.
Church-aided schools depend for funding of building projects on three sources—the relevant church authorities, the local education authority and central Government. Before any building or improvement project can go ahead, the support of all three sources is required. In north Oxfordshire, we seem to be experiencing difficulty in getting money allocated from central Government to provide for necessary improvements at two local schools.
The Blessed George Napier school in Banbury is a Roman Catholic secondary school for children throughout north Oxfordshire. It sets high standards, it is a popular school and it is not suffering from falling rolls. The local population of Roman Catholic children wishing to attend the school is likely to remain stable at least until the turn of the century.
In 1968, the then Secretary of State for Education and Science approved the enlargement of the school by about 150 places and the number of pupils duly increased by about that number. It has not been possible, however, to carry out the building works necessitated by that increase in numbers. The school urgently needs upgrading to meet the standards laid down by the Department of Education and Science guidelines, and I ask for nothing more than that the necessary funds be made available to enable the school to meet the standards set by the Department itself.
There is an urgent need for additional classrooms, accommodation for the sixth form and increased space for science, crafts and art. The need for that work to be carried out without delay is obvious. Architects' plans have been prepared and costings made. The Roman Catholic diocesan authorities are anxious that the work should be carried out as soon as possible. Oxfordshire county council is also anxious that the work should be carried out as soon as possible. In truth, I know that the Department of Education and Science recognises that the case is well made, as officials from the Department who visited the Blessed George Napier school on 27 March readily conceded the need for that work to be carried out.
Yet no money is forthcoming from the Department. Why? The reason is that money has been made available only for schools in areas of population growth or for schemes that are intended to remove surplus school places. It is claimed that this project, the Blessed George Napier, does not fall into either category, so money has not been made available.
I simply make the following brief points to my hon. Friend the Under-Secretary of State for Education and Science and to the House. If these criteria continue to be applied rigorously, funds will never be available for school building works, however urgent they may be, in areas of stable population. In any event, Banbury as a town has a consistently increasing population and is one of the main areas of intended population growth——

It being half past Two o'clock, the motion for the Adjournment of the House lapsed, without Question put.

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Lennox-Boyd.]

Mr. Baldry: —in the Oxfordshire structure plan. Furthermore, the building works at Blessed George Napier are needed in any event to accommodate and increase in the school's population that was agreed by the Secretary of State for Education and Science as long ago as 1968. I urge my hon. Friend the Under-Secretary of State to see whether money can be made available for this project now, and certainly to make funds available for Blessed George Napier from the 1986–87 programme for voluntary-aided schools. I would also put this question to the House. Whatever this project might cost now, how much more will it cost the community by being delayed?
Bishop Carpenter school at North Newington near Banbury is a primary school which presents a similar problem. Bishop Carpenter is a voluntary-aided, Church of England primary school. It has about 95 pupils who are drawn from a number of nearby villages. It has a high overall reputation, and a number of parents express a clear preference to send their children to this Church of England school.
For a considerable number of years, the governors of the school have wanted to improve its buildings. While structurally sound, it is an old Victorian school with very limited space which, not surprisingly, restricts teaching and other school activities. Some of the facilities, such as the lavatories, are positively primitive. The teaching area available and the hard playing area are both well below that which is recommended nationally. As the school has no hall, there is very little opportunity for physical exercise and drama productions, and meals have to be taken in the classrooms. The headmaster has nowhere private to interview parents, and the staff have nowhere of their own.
This school is seeking to serve the best educational needs of the local community but its buildings are desperately in need of improvement. The church now has the necessary funds. This project is at the top of the Church of England's diocesan priorities for Oxfordshire. The county council is prepared to meet its share of the necessary funds. Likewise, the project is at the top of the county's application for moneys for church-aided schools. In short, wheher or not these urgent building works can go ahead is dependent on central Government.
For a number of years now, Oxfordshire county council has applied to the Department of Education and Science for such funds as may be necessary to tackle this work.


Year by year, these funds have not been forthcoming, and consequently year by year the project has slipped. Year by year the present facilities continue to deteriorate. The parents and governors have drawn up plans to improve the school that will retain all the best features of the present building while ensuring proper facilities for a mixed, three-class primary school.
To fulfil the needs of an active, living village school with high educational standards and a high reputation in the community would, I should have thought, be exactly the sort of objective that the Department of Education and Science would want to meet. Simply to look at this matter local education authority by local education authority inevitably means that well-deserving individual projects are neglected within those local education authorities which overall may have falling rolls, even though some schools within an LEA, such as Bishop Carpenter, may have expanding numbers, in less than adequate conditions, because parents have chosen to send their children there.
I very much hope that the Department of Education and Science will be able to make available as soon as possible the necessary money for its share of the work on Bishop Carpenter school.

The Parliamentary Under-Secretary of State for Education and Science (Mr. Bob Dunn): I congratulate my hon. Friend the Member for Banbury (Mr. Baldry) on his success in obtaining the debate and on the way in which he presented his case so fully and forcefully. I am grateful for the presence of my hon. Friends the Members for Oxford, East (Mr. Norris) and for Morecambe and Lunesdale (Mr. Lennox-Boyd) who both share the Government's concern that the controlled and aided sector should be maintained and supported.
Before turning to the detailed points made by my hon. Friend the Member for Banbury, I should like briefly to set the scene by saying something about the role of voluntary schools within our maintained system of education. There are about 25,000 maintained primary and secondary schools in England—maintained in the sense that local education authorities meet their day-to-day running expenses. The majority of these were also provided by the authorities and are known as county schools. However, a substantial minority—just over 8,000 or about a third—of maintained schools were provided by voluntary bodies, principally the churches. These are the voluntary schools.
There are three types of voluntary school. The most numerous are aided schools of which there are about 4,500. Certain capital and external repair work remains the responsibility of the governors of aided schools, for which they are generally entitled to 85 per cent. grant from the Department. In view of that stake in the continued financing of such schools, the foundation concerned has a majority on the governing body, which has significant powers in maintaining the school's distinctive ethos. Secondly, there is the historically closed class of about 100 special agreement schools which, for most purposes, can be regarded as aided schools.
Thirdly, there are about 3,500 controlled schools. For present financial purposes, these are similar to county schools where all recurrent and capital costs are met by the maintaining authority. In view of the initial provision of

premises, though, the foundation has a substantial minority on the governing body, which has certain powers to preserve a distinctive ethos for the school.
The great majority of voluntary schools have been provided by the churches, for historical reasons, principally by the Anglican and Roman Catholics. Religious affiliation is not a prerequisite, though, and there are several non-denominational schools.
These voluntary schools were brought into the maintained sector by the dual system of county and voluntary schools created by the Education Act 1944. The Government have said on a number of occasions, and I am glad to repeat it, that they are wholly committed to the dual system. We welcome the diversity that voluntary schools bring to the maintained sector, which enables a wider range of parental preferences to be met.
My hon. Friend the Member for Banbury spoke eloquently about the case for major building projects at two aided schools in Oxfordshire—the Blessed George Napier Roman Catholic comprehensive school. Banbury and the Bishop Carpenter Church of England primary school, North Newington. Neither has yet found its way into the necessary building programme. Funds for such projects are not, of course. unlimited. One of the main aims of the Government's economic policy is a permanent and sustained reduction in the rate of inflation, because only in that way can we generate the wealth needed to pay for services. Central to that policy is a continuing limitation of public expenditure both by central and local government; education cannot be exempt from the need for restraint.
The available resources have therefore to be allocated carefully to priority projects. Let me explain how we set about that. Each summer, the Department invites local education authorities to submit details of capital expenditure plans for their county and voluntary schools in the following year. In aggregate, those plans inevitably exceed what the country can afford. We are therefore faced with difficult decisions in the face of conflicting priorities. In that process, our priorities have been, first, to meet commitments arising from projects started under allocations made in previous years. This accounts for a large part of the resources available. Account has then to be taken of new projects needed to enable authorities to make sufficient provision for the children in their areas. In areas of population growth calling for more places in local schools, a high priority is given for an appropriate capital allocation whether for new schools or extensions to existing ones. In recent years, we have always been able to meet the bids for such projects.
In addition, when statutory proposals have been published for the removal of surplus places and approved by my right hon. Friend, and when these include a related capital project, we have generally been able to provide a capital allocation so that the work can go ahead to fulfil the new duty created by the Education Act 1980 that the proposers—the governors in the case of an aided school—must implement an approved proposal. Allowance has then to be made for urgent minor capital projects. Only then can consideration be given to improvement projects which, although they may be worth while in themselves, are less pressing than the other categories that I have outlined.
The level of committed expenditure on aided school projects anticipated for 1985–86 is higher than our plans had allowed for. This was for a number of reasons. For


example, costs have in some cases risen more than expected, initial estimates may have proved to be too low and work may have gone ahead faster than planned. Even though the provision for all work at aided schools was set at £50·1 million—compared to the outturn of £44·8 million in 1984–85—this has put severe pressure on the new work that could be programmed for 1985–86. Governors' plans for work at aided schools, by contrast, totalled over £90 million. Priority had to be given to projects that were statutorily necessary—that is, basic need projects or projects required to implement proposals approved under the 1980 Act.
In its bid for the 1985–86 programme, Oxfordshire listed three major aided school projects. In priority order, these were the St. Augustine's Roman Catholic/Church of England secondary school and then the two my hon. Friend has mentioned—Bishop Carpenter and the Blessed George Napier.
My hon. Friend suggested that we do not consider individual projects when making capital allocations. He will realise from what I have said that we examine carefully each project which comes to us so that we can decide whether it comes into one of the priority categories. The St. Augustine's project, to which the local education authority gave first priority, came within one of the priority categories and it was then authorised to start. In the light of the representations made this afternoon and in earlier correspondence by my hon. Friend the Member for Banbury, I readily acknowledge the desirability of the other two projects. I can assure him that there is no lack of awareness of local views on the need for these projects. The fact remains, however, that neither of them could be classified as the high priority needed for inclusion in this

year's programme. It will be of little consolation to my hon. Friends, but many other similar worthwhile projects had to be excluded this year. Indeed, many areas had no major projects selected for a start this year.
I might add that, as a normal part of our management of resources, we keep a shortlist of projects that we would be prepared to authorise to start this year if resources became available through the delay or cancellation of a project elsewhere. The project at the Blessed George Napier school has been added to that list but, as my hon. Friends will understand, even if resources are so released, much depends on an assessment of the relative priorities of those projects on the list. Clearly, I can offer no guarantee that any shortlisted project will be able to go ahead this year, let alone those under discussion.
Failing that, my hon. Friend would obviously like me to give some assurances about the inclusion of either project in the programme for 1986–87. Much as I would like to help him, I cannot. All I can say is that, if, in response to the annual invitation made last month, Oxfordshire puts them forward again—as seems most likely—they will be very carefully considered. That consideration will obviously have to be informed by the overall level of resources available and take account of the merits of competing projects in Oxfordshire and elsewhere.
I am, of course, available at any time. My hon. Friend the Member for Banbury will appreciate that I cannot go any further at this stage, but I congratulate him on so clearly placing before the House his constituents' needs and interests.

Question put and agreed to.

Adjourned accordingly at sixteen minutes to Three o' clock.